Shakey’s Pizza sees strong sales continuing this year

HIGHER SALES and extraordinary gains boosted the net profit of the operator of the Shakey’s Pizza chain in the Philippines last year, with the strong performance seen continuing in 2017, as the company rolls out more stores, including its maiden branch overseas.

Shakey’s Pizza Asia Ventures, Inc. ( SPAVI) told the stock exchange on Monday it reported a 40% hike in recurring net income to P670 million last year, which the firm attributed to “stronger sales, an expanded store network, and improved profitability.”

Net earnings stood at P760 million, inclusive of a net nonrecurring income of P90.3 million due to the change in ownership early last year, and a subsequent corporate restructuring and initial public offering during the second half. SPAVI did not disclose the comparative data.

System- wide sales rose 14.3% to P7.34 billion, driven by same-store sales growth of 3.9% and increased contribution of new stores.

Recurring revenues, including those from an inhouse commissary, climbed 4.7% to P6.01 billion. Late last year, SPAVI acquired a commissary which supplies bakery products to Shakey’s as well as other food service customers.

SPAVI has recorded recurring net income margin expansion of 200 basis points due to favorable commodity prices and purchasing synergies since Century Pacific Group, inc. and GIC, Singapore’s sovereign wealth fund, concluded a deal to buy the company last year.

“The first two months of this year have been very encouraging and we are optimistic that we will continue the strong performance into 2017,” SPAVI President Vicente L. Gregorio was quoted in the statement as saying.

Shakey’s added 17 outlets last year compared to the 14 opened the year before to close 2016 with a network of 184 stores. The company is accelerating its store expansion this year, with a plan to roll out an additional 20 new stores, including its first branch overseas.

SPAVI - which also owns the perpetual rights to the Shakey’s brand for the Middle East, Asia ( excluding Japan and Malaysia), China, Australia, and Oceania - is set to open its first international store in Kuwait in the third quarter after signing a development agreement with a franchisee to build at least 10 Shakey’s Pizza outlets in that area.

Shares in SPAVI slid 42 centavos or 3.06% to close at P13.32 apiece on Monday. —