Max’s Group Reports P248M Net Income for 1H
Max’s Group, Inc. (MGI) posts net income of P247.74 million for the first six months of 2015, marking a 561% increase compared to the same period last year.
“We continue to build on the momentum gained in the first quarter and expect to sustain this growth trajectory on the back of well structured operations,” stated Robert F. Trota, President and CEO of MGI.
The largest operator in the chained full-service restaurant segment disclosed its first half results on Thursday, which pertains to the results of operations of Max’s Entities and Pancake House Group from January to June this year.
During this period, Max’s Group consolidated revenues increased 166% to P4.88 billion versus reported figures for the same period last year. On a pro-forma basis, topline growth was 6% despite ceasing operations of 10 branches of Le Coeur De France, which is set to undergo a major rebranding campaign to upgrade product quality and service platform. Planned closures form part of the company’s on-going integration program to rationalize its branch network to maximize resources and improve profitability. During this phase, MGI aims to consolidate a larger base of operations by standardizing procedures and streamlining back-end support to capitalize on operational efficiencies. Future openings will be located in prime growth areas featuring a refreshed store look and design complemented by enhanced menu offerings.
“As we previously mentioned, we continue to evaluate operations of brands and store network and act upon closing underperformers to minimize drag on the system,” Trota said.
Store sales, which comprised bulk of revenues, rose 5% to P4.13 billion from P3.92 billion for the first six months of 2014. Franchise income likewise grew 47% to P190.16 million as of June 2015 from P128.97 million in the same period last year. Commissary sales remained relatively flat at P559.63 million year-on-year.
Expanding into new territories
“We remain on track with our expansion plans both domestically and overseas. In the coming months, we expect to finalize development agreements for some of our brands in new territories,” Trota remarked.
From April to June, the Company opened 13 outlets including four international. The company opened its fourteenth Max’s Restaurant in North America located in Daly City, California. It also unveiled a new Pancake House in Damansara Jaya, Kuala Lumpur bringing its total to 8 stores in Malaysia.
“Most of our new store rollouts traditionally occur in the latter part of the year,” Trota added.
As of July, Max’s Group has a total of 535 outlets. It is also geared to accelerate its store rollout pace for the second half in time for scheduled mall openings, election related activities and Christmas season, all of which are seen to significantly boost revenues.
Improved operational efficiency
“The company continues to rationalize its store network and streamline back-end operations to leverage on synergies and efficiencies,” cited Trota. “While these initiatives are already reflective in our results, we have yet to fully realize a considerable amount of cost savings to be derived from operational improvements this year.”