Competition dents Max’s Q3 earnings

INCREASED competition in the local restaurant industry, coupled with rising raw material prices, dented Max’s Group, Inc.’s (MGI) profit in the third quarter.

In a regulatory filing, the listed casual dining restaurant said its net income attributable to the parent reached P90.2 million during the July to September period, 1.5% lower than the P91.6 million recorded in the same period a year ago.

MGI noted its operations were affected by an increase in commodity prices, more competition, and the rainy weather during the three-month period. The company said it dealt with these headwinds by streamlining its menu mix and marketing campaigns, in order to offset the effects of price hikes.

MGI saw a 13% uptick in third quarter revenues to P2.99 billion, as it opened 58 new stores both locally and overseas during the third quarter. However, gross expenses also grew by 12% to P2.86 billion.

On a nine-month basis, MGI’s attributable profit increased 8% to P419 million, on the back of an 11% rise in revenues to P9.04 billion.

The company said restaurant sales jumped 13% to P7.59 billion on new stores’ revenue contribution and “healthy” same-store sales. It noted blended same store sales growth stood at 5% during the nine-month period.

“The results underscore our steady growth state notwithstanding the effects of cyclicality, rising input costs and heightened competition. As we channel this momentum into the Christmas season, we are primed for another strong finish to cap off the year,” MGI President and Chief Executive Officer Robert F. Trota was quoted as saying in a statement.

MGI is currently present in North America, the Middle East, and some parts of Asia through various brands, namely Max’s Restaurant, Yellow Cab Pizza, and Pancake House among others. —