Shakey's Net Income More Than Double, Sales 33% Up

Shakey’s Pizza Asia Ventures, Inc. (PSE:PIZZA), the Philippines’ leading full-service restaurant chain and foodservice group, posted upbeat results for the first quarter of 2022 with systemwide sales hitting double-digit growth and net income increasing by 2.7x versus the same period last year.

Photo Insert: The group kicked off the year by opening 5 new stores net, bringing PIZZA’s systemwide fast-casual store count to 321.

PIZZA’s systemwide sales, a composite of company-owned and franchised stores’ sales, landed at Php 2.2 billion, clocking in a growth of 33% year-on-year. The robust performance was driven by easing quarantine restrictions beginning February 2022, leading to a revival in foot traffic.

As a result, the Company benefited from a strong resurgence in dine-in sales, accompanied by a sustained off-premise business.

In addition, PIZZA had successfully brought Potato Corner, one of the leading food kiosk brands in the country, into the fold in March, further boosting the Company’s sales performance. Potato Corner likewise benefited from loosening restrictions, seeing its highest foot traffic since the onset of the pandemic.

The group kicked off the year by opening 5 new stores net, bringing PIZZA’s systemwide fast-casual store count to 321. This consisted of Peri-Peri and Shakey’s outlets and one international store in Singapore. Potato Corner, on the other hand, expanded its store network by 39 outlets – 30 in the Philippines and 9 internationally, ending the quarter with a total of 1,311 stores.

Vicente Gregorio, PIZZA’s President and Chief Executive Officer, said, “We are very pleased with the quarter’s turnout. Amidst an operating environment that was less than ideal, the Company was able to deliver healthy business results, which we can attribute to our long-term approach throughout the pandemic. We remained resolute in investing in our brands, in our stores, and in our people. We strengthened our digital infrastructure. We explored inorganic opportunities, so now we have another ‘Wow’ brand, Potato Corner, contributing to our growth.”

In terms of profitability, PIZZA’s gross profit was at Php 390 million, registering a growth of 23% versus the same period last year. Gross margin for the quarter stood at 24.2%, softening by 50bps versus the comparable period last year due to the general rise in input prices globally. With a strong topline performance, operating expenses as a percentage of revenues improved by 100bps year-on-year.

PIZZA’s earnings before interest, taxes, depreciation, and amortization (EBITDA) increased by 22%, landing at Php 293 million. 1Q22 EBITDA margin was at 18.2%, softening by 50bps versus 1Q21. Overall, the robust topline, combined with efficient operations, led to a net income of Php 76 million, 2.7 times higher than the same period the year before. PIZZA’s net profit margin likewise expanded by 250 bps to 4.7%. All brands posted a positive bottomline for the quarter.

According to Gregorio, the company is planning for a skyward trend in results as it progresses further into

2022.

“Early second quarter results are demonstrating a continuous growth momentum. Our long-awaited Philippine reopening is finally here. We are seeing an influx of guests in our stores. Group size is improving. At the same time, our store network expansion program is in full swing in our pursuit to scale up our brands and reach more guests domestically and even internationally.” he said.

Gregorio added, “Barring the emergence of new variants or any other major external factors, we plan to get systemwide sales to exceed pre-pandemic level by year-end. We recognize short- to mid-term headwinds at play, but throughout the course of the pandemic, we have learned to pivot and evolve – all to deliver lasting value to our guests. We will continue on this path and, hopefully, reignite a new double-digit topline and bottomline growth streak in 2022.”

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