CASUAL dining operator Max’s Group Inc. has returned to profit, posting a net income of P313.12 million in the year’s first nine months, from a net loss of P31.36 million a year ago, when it acquired Pancake House.
In a disclosure to the Philippine Stock Exchange on Wednesday, the firm said its strong system-wide sales and stores expansion had pushed up its bottom line.
Max’s Group Chief Financial Officer Dave Fuentebella said strong growth and potentials were seen in the company’s “four star brands,” namely, its flagship Max’s Restaurant, Pancake House, Yellow Cab, and Krispy Kreme.
“Mainly, we’re looking at expanding in two regions—the Gulf Estates and Southeast Asia—somewhere we haven’t had explored and we’re not presence yet,” Fuentebella told reporters. “The clamor for Max’s brands is really to have Filipino restaurants in these countries.”
The Max’s Group recorded a net income of P313.12 million from a net loss of P31.36 million a year ago, pro-forma basis. Pro-forma basis is when the company consolidated operations after it acquired Pancake House around the same time last year.
Revenues increased by six percent to P7.3 billion, as system-wide sales rose seven percent to P10.4 billion.
“The results are reflective of the historical seasonality effect during this time of the year,” Robert F. Trota, MGI president and CEO said. “Nevertheless, we are poised to generate momentum ushering into the Christmas period.”
As of end-September, the company has opened 31 stores, bringing the total to 547 stores.
Despite delays in the opening of stores, Fuentebella said the group is still on track with its target of opening the balance of 60 to 70 stores—out of the 80 to 90 target openings for 2015—by yearend, to end at 604 stores.
The revenue mix of the 547 stores to date is: 63 percent company-owned, 29 percent franchised, six percent in international ventures, and two percent for joint ventures.
The stores are mostly located in the Philippines—Metro Manila (60 percent), Luzon (23 percent), Visayas (six percent) and Mindanao (five percent)—while the rest, or six percent are abroad.
Fuentebella said the Max’s Group plans to have 1,000 stores by 2020, about 20 percent of which will be abroad.
He said the company is looking at P700 million to P800 million of capital expenditures yearly in the next five years towards 2020.
Fuentebella said the Max’s Group is “actively exploring opportunities in Asia” for its Teriyaki Boy brand.
He said only Max’s Restaurant would be catered mostly where there is a huge population of the 12 million overseas Filipinos, while the other brands will be “marketed as mainstream and foreign brands” in places “where there is a concentration of disposable income.”
The Max’s Group has three existing developing ventures overseas, including at least eight Pancake House stores in United Arab Emirates, at least 10 outlets of Yellow Cab Pizza also in UAE, at least 10 Sizzlin’ Steak stores all over Vietnam. All these will be done in a span of five years towards 2020, according to Fuentebella.
The Max’s Group’s restaurant brands are present in various markets, namely: Vietnam, Malaysia, Brunei, and the Philippines, for Southeast Asia; Kingdom of Saudi Arabia and Qatar, for the Gulf estates; and in North America.
Comprising the Max’s Group’s restaurant portfolio are: Max’s Restaurant, Pancake House, Yellow Cab, Dencio’s, Kabisera ng Dencio’s, Teriyaki Boy, Max’s Corner Bakery, Maple, Sizzlin’ Steak, and Le Coeur de France, as well as international brands Krispy Kreme and Jamba Juice.