Shakey’s Pizza Reports a Net Income Growth of 26% for the First Quarter of 2017
The Philippines’ leading chained full-service restaurant, Shakey’s Pizza Asia Ventures Inc. (PSE: PIZZA), reported a consolidated net income after tax of Php173 million for the first three months of 2017. This represents a 26% growth against the same period last year, driven by stronger sales and improved profitability.
System wide store sales, a combination of company-owned and franchise store sales, grew by 22% to Php2.0 billion for the first quarter of 2017 from the Php1.6 billion during the same period last year. Same store sales growth (SSSG) registered at 11.6% for the first quarter of 2017 as in store head count and average checks increased.
The Company’s net revenues as a result increased by 25%, ending at Php1.7 billion for the period ending March 31, 2017, compared to the Php1.3 billion registered during the same period last year.
PIZZA was also able to improve on its profitability as margins for gross profit and earnings before interest, taxes, depreciation, and amortization (EBITDA) expanded by 530 bps to 29.9% and 170bps to 19.6%, respectively.
As a result, gross profit and EBITDA grew by 52% and 37%. The Company attributes this growth to favorable commodity prices and purchasing synergies post consolidation into the Century Pacific Group, which announced a partnership in April of last year to acquire majority of the pizza business.
“We are pleased with the robust first quarter numbers, particularly the double digit SSSGs owing primarily to the success of our “2017 meal deal” promotion. The first quarter is typically a lean season for our business so we are glad that the combined results of marketing programs and successful store openings have delivered the desired results. While growth may moderate in the coming months, we are firmly on track to meet our full year targets especially considering the seasonality of our business, where we usually see an increase in consumer spending towards the year end,” said Vicente Gregorio, President and CEO of PIZZA.
Gregorio added, “Shakey’s has always been known for its “think Guest” motto in stores. Coupled with excellent marketing and continued product innovation, we should be able to build on Shakey’s 40-year brand legacy and maintain our leading position in the industry despite the entry of various foreign and independent names and other competitive pressures down the road.”
For the first quarter of 2017, PIZZA added 5 new stores to its network bringing total store count to 189. It targets a total of 20 new outlets by year-end, hoping to close 2017 with a 204 store network.
Apart from the Philippines, PIZZA also owns the perpetual rights to the Shakey’s brand for the Middle East, Asia (excluding Japan and Malaysia), China, Australia, and Oceania. In the third quarter, it is set to open its first international store in Kuwait having signed a development agreement for the construction of at least 10 Shakey’s outlets in the region within a span of 7 years.
The Company also recently declared a ten centavos dividend per share (Php0.10) to all shareholders of record as of June 6, 2017, payable on June 30, 2017.
Shakey’s has been creating over 40 years of great times and great memories in the Philippines. Having started its first store in Metro Manila in 1975, Shakey’s now operates nationwide with a store count of 189 stores. Shakey’s is one of the leading operators of Fast Casual Restaurants in the Philippines, focused on family casual dining. It maintains market leadership in both the chained pizza full-service and chained full-service restaurant categories. Shakey’s believes its superior value arises from its differentiated menu offerings, high-quality products, and a mission to consistently provide great times and great memories to every Shakey’s guest.