Jubilant FoodWorks Q2 profit up 3.85%2 min read . Updated: 13 Nov 2020, 08:08 AM IST
- Consolidated revenue from operations was down 18.2% to ₹816.32 crore
- In all, during the three months ended 30 September the delivery channel grew 5.8% year-on-year; while takeaway channel registered growth of 49.8% year-on-year
Jubilant FoodWorks Ltd, which operates the Domino’s Pizza chain and Dunkin’ Donuts outlets in India, on Thursday reported a 3.85% jump in September quarter consolidated net profit at ₹75.7 crore, the company informed exchanges.
Consolidated revenue from operations was down 18.2% to ₹816.32 crore compared to ₹998.05 crore reported in the year ago period.
Sales at the fast-food chain were led by a strong growth in takeaway and delivery channels as consumers remained unsure about returning to stores to dine-in.
“The sales momentum continued in October with revenues recovering to 96.2% of last year, driven by delivery growing by 16.3% and takeaway by 64.3%," the company said in its statement. Overall system sales for Domino’s recovered to 82.3% of last year’s level during the quarter, the company said as covid-related lockdown impacted operations at its outlets in the June quarter.
In all, during the three months ended 30 September the delivery channel grew 5.8% year-on-year; while takeaway channel registered growth of 49.8% year-on-year.
“We re-opened most of our stores across cities with a few stores that were not open being in corporate parks or in specific locations that had restrictions. We brought a strong focus on delivery and delivery channels to mitigate the pressure on dine-in," Pratik Pota, CEO and wholetime director, Jubilant FoodWorks Limited told investors during the company’s earnings call on Thursday.
“In delivery, we removed the threshold of a minimum order value requirement that we believe will help grow orders and will allow us to tap into both a new set of emerging customers and also into new occasions. The takeaway channel continued to see strong momentum…" he said.
He added that the dine-in channel saw an encouraging recovery sequentially, but remained muted. Smaller cities grew ahead of larger cities, said Pota. “Within this recovery, our larger metro towns of Mumbai, Delhi-NCR and Bangalore showed a slower recovery as compared to other smaller towns," Pota said.
Abneesh Roy, executive vice-president, research, Edelweiss Securities said Jubilant saw a strong margin expansion. “What is helping gross margins is clearly softer dairy and cheese prices. Also, the level of discounting in the industry has come down and the company is focused on reducing wastage. Besides, it is also levying a delivery charge. All these things are aiding margins."
However, same store sales growth that refers to the year-over-year growth in sales for Domino’s restaurants opened before previous financial year was down 20% in the second quarter.
“Our strong recovery continued in Q2FY21 with overall revenues recovering to 82.3% of last year, driven by delivery and takeaway channels growing over last year. Our EBITDA margins increased by 290 bps year-on-year and PAT margins increased by 180 bps year-on-year," said Pota.
The promoters of HT Media Ltd, which publishes Mint, and Jubilant FoodWorks are closely related. There are, however, no promoter cross-holdings.