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Jubilant Foodworks’ Q4 profit falls 24% to `25 crore

LiveMint logoLiveMint 19-05-2014 Suneera Tandon

Jubilant FoodWorks Ltd (JFL), which operates restaurant chains under Domino’s Pizza and Dunkin’ Donuts, reported a 24% decline in fourth-quarter profit, as inflation continued to affect household spending on items such as pizzas and burgers.

Net profit fell to `25 crore in the three months ended 31 March from `33 crore in the year earlier, the company said on Monday. Revenue for the quarter increased 18.5% to `433.7 crore.

The macroeconomic condition impacted consumer spends leading to a drop in same-store growth (SSG), said Ajay Kaul, chief executive at Jubilant FoodWorks. “We have concentrated on leveraging our experience and tools such as promotions, innovation and cost efficiency initiatives to tide over the downturn,” he said.

Same-store-sales growth, a measure of sales at stores open for at least a year, during the quarter slowed to 3.4% from a 7.7% pace in the same quarter last year.

Increased expenditure compounded the compression in margins, said the company. Ebitda, or earnings before interest, taxes, depreciation and amortization, for the quarter dropped 9% to `55.68 crore.

Total expenditure for the quarter rose 24% to `378 crore as the company spent more money to expand its network, opening 47 new restaurants.

For the fiscal 2014, Jubilant FoodWorks posted a 22% jump in revenue at `1,723.5 crore, while net profit declined by 6% at `125.8 crore. SSG growth in FY14 was at 1.6% compared with 16.2% for the previous fiscal.

Kaul said the company has identified areas with potential and will accordingly invest in development of new commissaries. Currently, the company is building new commissaries in Guwahati, Nagpur and Hyderabad. The company intends to add 150 Domino’s outlets apart form 25 Dunkin’ Donuts outlets in the current fiscal.

Shares of Jubilant Foodworks rose 3% to `1,190 apiece on BSE on Monday.

The promoters of HT Media Ltd, which publishes Hindustan Times and Mint, and Jubilant FoodWorks are closely related. There are no promoter crossholdings.

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