MANILA - Jollibee Foods Corp said Friday it slashed its capital expenditure for 2020 due to the global impact of the coronavirus pandemic while remaining confident of its "bright future."
This year’s capital expenditure was cut to P5.2 billion from P14 billion, said JFC president and CEO Ernesto Tanmantiong during its first virtual stockholders meeting.
Despite the reduction, the country's largest restaurant operator will still expand "on a very selective basis" for the rest of the year, Tanmantiong said.
"The COVID-19 pandemic has significantly disrupted our business and our lives but JFC has been adjusting very quickly," Tanmantiong said.
"I am confident as ever about the bright future of our company, recovery is already starting to take place in other countries where the lockdowns are easing," he added.
JFC said it has embarked on a P7 billion business transformation to adapt to the changes in the economy brought by the pandemic as consumers prefer take-out and digital channels.
Drive thru transactions have been improved, curb side pick-ups have been introduced, as well as new family and group meals made available for home consumption, Tanmantiong said.
In 2019, consolidated net income reached P6.4 billion, down 21.7 percent compared to the P8.2 billion in 2018, JFC said.
"The business environment proved to be more difficult than we anticipate" with Red Ribbon and Smashburger's operating profit decline, Tanmantiong said.
In 2020, it could incur "higher losses" in the second quarter due to the full impact of the COVID-19 lockdowns, said JFC chief financial officer Ysmael Baysa.
The island of Luzon was placed on lockdown in March to stem the spread of COVID-19. Metro Manila remains under general community quarantine until July 31.
Baysa said businesses could recover in the third and fourth quarter "but we assume that recovery could be slow."
Changes are "short-term and manageable" said Tanmantiong.
“I have also always believed in our JFC family’s resiliency and perseverance that has seen us through many obstacles before. We have a clear vision and we stay focused on our mission – ‘to serve great tasting food, bringing the joy of eating to everyone’. This is our pledge to our customers and the communities that surround us. We will emerge as a stronger business and organization out of this crisis,” Tanmantiong said.