Jollibee Foods—controlled by billionaire Tony Tan Caktiong—said Thursday it plans to accelerate its global expansion this year after the Philippine fast-food giant reported that operating profit returned to pre-pandemic levels.
Bolstered by robust contributions from its restaurants in the Philippines, and international markets, particularly North America, Jollibee reported a full-year operating profit of 6.3 billion pesos ($123 million) in 2021, almost the same level as the 6.5 billion pesos reported in 2019 just before the Covid-19 pandemic wreaked havoc on the global economy. It was also a sharp reversal of the 12.8 billion peso operating loss the company incurred in 2020 when lockdowns meant to curb the spread of coronavirus shuttered restaurants.
“We look forward to continuing strong recovery of the business in 2022 particularly if the restrictions in the Philippines are fully lifted, coupled with increased consumer spending during this election year,” Jollibee CEO Ernest Tanmantiong said in a statement.
This year, Jollibee is earmarking 17.8 billion pesos in capital expenditures to open up 500 new stores, to expand logistics facilities and to renovate existing restaurants around the world, more than double the 7.8 billion pesos spent in 2021 when it opened 398 stores. The global expansion will be funded by cash generated from operations, bank loans as well as proceeds from bond issuances and a potential initial public offering of its warehouse joint venture later this year.
“Beyond 2022, our outlook for business growth is even brighter,” Tanmantiong said. “We see very strong expansion in different parts of our business particularly in North America, China, Southeast Asia and Europe, while we expect the Philippines to sustain its healthy profitable growth.”
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Jollibee has been growing its global footprint organically as well as through acquisitions. Last year, it took a controlling interest in the Tim Ho Wan dim sum chain across Asia and bought a stake in Taiwanese bubble tea chain Milksha and invested in the Philippine franchise of Yoshinoya Japanese restaurants.
Founded by Tan Caktiong in 1975 as a small family business selling ice cream, Jollibee now operates more than 3,200 outlets in the Philippines and over 2,700 overseas—including U.S.-based chains Smashburger and Coffee Bean. With a net worth of $2.7 billion, Tan Caktiong, 68, was ranked No. 7 on Forbes Asia’s list of the Philippines’ 50 Richest people that was published in September. He also owns a stake in developer DoubleDragon Properties.
In August, Jollibee bought a stake in DoubleDragon’s CentralHub Industrial Centers after injecting 16.4 hectares of industrial properties which the restaurant chain utilizes as commissaries. The partners are ramping up the construction of warehouses across the Philippines to tap the booming demand from e-commerce companies, ahead of an IPO in the second half of 2022, CentralHub said last month. It will be the country’s first real estate investment trust focused on warehouse logistics assets.
“We will use the proceeds from the eventual IPO of CentralHub to finance real estate investments for our new stores and commissaries which we will convert again into more investments and shares in the REIT,” Tan Caktiong said when Jollibee first invested in CentralHub in August. “Basically, the REIT will help continuously finance our future expansion.”