Jubilant FoodWorks Q1 Results

Jubilant FoodWorks Q1: Net Profit Skyrockets 93%, Sales Surge 45%

Jubilant FoodWorks Limited (JFL), the master franchisee for Domino’s Pizza in India, has delivered an impressive performance for the June quarter, showcasing strong growth across its business lines. With a significant 93% jump in net profit and a 45% surge in net sales, the company continues to reinforce its leadership in the Indian foodservice industry. This article delves into the key financial metrics, strategic initiatives, and the impact of JFL’s performance on its market presence.

Financial Highlights

Surge in Net Profit

Jubilant FoodWorks reported a consolidated net profit of ₹55.8 crore for Q1 FY24, marking a substantial increase of 93% from ₹28.9 crore in the corresponding quarter of the previous year. This remarkable growth reflects the company’s successful execution of its strategic initiatives, including an enhanced focus on delivery and network expansion.

Robust Sales Growth

The company’s net sales for the quarter stood at ₹1,933 crore, up 45% from ₹1,334.5 crore in the same period last year. This surge in sales was driven by a combination of strong like-for-like (LFL) growth, new store openings, and an increase in delivery channel revenue.

Improvement in EBITDA Margins

Earnings before interest, tax, depreciation, and amortization (EBITDA) for Q1 was ₹383 crore, reflecting a growth of 23.4%. The EBITDA margin improved by 85 basis points year-on-year to 19.8%, showcasing the company’s efficiency in managing costs while driving revenue growth.

Strategic Initiatives and Operational Performance

Expansion of Domino’s Store Network

JFL’s commitment to expanding its footprint in India is evident from the opening of 34 new Domino’s stores during the quarter, bringing the total net addition to 52 stores across all its brands. This expansion is part of JFL’s broader strategy to make Domino’s more accessible to customers across the country.

Focus on Value for Money

The company’s sharpened focus on delivering value for money, particularly through the waiver of delivery fees, played a pivotal role in accelerating growth. This initiative was well-received by customers, contributing to the strong performance in the delivery channel.

Leadership Comments

Shyam S Bhartia and Hari S Bhartia, Chairman and Co-Chairman of Jubilant FoodWorks, expressed their satisfaction with the Q1 results, highlighting the broad-based growth across markets. They noted that the company is on track to become India’s first foodservice company to cross $1 billion in group system sales, driven by healthy LFL growth and continued network expansion.

Segment Performance

Domino’s India

Domino’s India reported a 3% LFL growth, driven primarily by a 12% growth in delivery LFL. Segment revenue growth for JFL India was 9.9%, while Domino’s revenue grew by 8.5% on the back of a 16% increase in order growth. Despite a decline in dine-in channel revenue by 5.7% year-on-year, the overall performance remained strong due to the robust growth in delivery.

International Operations

• Domino’s Bangladesh: Revenue grew by 42.2% to ₹17 crore, supported by accelerated network expansion with 10 net new stores added over the past year.
• Turkey, Azerbaijan, and Georgia: DP Eurasia, the franchisee for Domino’s in these regions, reported a revenue increase of 15.4% year-on-year to ₹461 crore. The region saw a net addition of 33 stores in the last year, with an operating EBITDA of 25% and a PAT margin of 9.2%.
• Domino’s Sri Lanka: Revenue grew by 17% to ₹17.4 crore, with the company onboarding new aggregators, Uber Eats, and Pick Me.

Despite record-high inflation, Domino’s Turkey reported a 10% LFL growth, highlighting the brand’s resilience and market strength.

CEO’s Perspective

Sameer Khetarpal, CEO and MD of Jubilant FoodWorks Limited, hailed Q1 FY24 as a ‘milestone quarter’ for the company. He emphasized the quality of growth, noting that it was order-led with monthly active users reaching record highs. The company’s strategy of being customer-first and leveraging data and technology has paid off, enabling JFL to acquire new customers at an unprecedented rate, surpassing industry trends.

Khetarpal also highlighted the significant achievements in expanding the store network, with Domino’s India crossing the 2,000-store mark, COFFY Turkey exceeding 100 stores, and Popeyes India reaching 50 stores.

Market Reaction

Despite the strong financial performance, Jubilant FoodWorks shares closed 11.1% lower at ₹597.05 apiece on the BSE on August 8, a day before the earnings announcement. The decline could be attributed to broader market conditions or profit booking by investors ahead of the earnings report.

Conclusion 

Jubilant FoodWorks delivered impressive Q1 FY24 results, with a 93% jump in net profit and a 45% increase in sales. This growth was driven by strong performance across its business lines, particularly in the delivery channel and new store openings. The company’s strategic focus on value for money and network expansion has reinforced its leadership in the Indian foodservice industry, setting the stage for continued success. Despite these achievements, market reaction was mixed, possibly due to broader conditions or profit booking by investors.

FAQs:

1.What was the net profit growth for Jubilant FoodWorks in Q1 FY24?

A. Jubilant FoodWorks reported a 93% increase in net profit to ₹55.8 crore for Q1 FY24.

2.How much did the company’s net sales grow in Q1 FY24?

A. Net sales grew by 45% to ₹1,933 crore in Q1 FY24.

3.What contributed to the surge in Jubilant FoodWorks’ revenue?

A. The revenue surge was driven by strong LFL growth, new store openings, and an increase in delivery channel revenue.

4.How did Jubilant FoodWorks improve its EBITDA margins?

A. The EBITDA margin improved by 85 basis points to 19.8%, reflecting better cost management and increased sales.

5.What was the impact of delivery fee waiver on Domino’s India?

A. The delivery fee waiver helped boost delivery channel revenue by 15.7%, despite a decline in ticket size partially offset by packaging charges.

6.How many new stores did JFL open in Q1 FY24?

A. JFL opened 34 new Domino’s stores and added 52 net stores across all its brands.

7.What was the performance of Domino’s Bangladesh in Q1 FY24?

A. Domino’s Bangladesh reported a 42.2% revenue growth to ₹17 crore, driven by network expansion.

8.How did the international business perform for JFL?

A. JFL’s international operations, including Turkey, Azerbaijan, Georgia, and Sri Lanka, showed strong revenue growth and network expansion.

9.What were the key achievements for Jubilant FoodWorks in Q1 FY24?

A. Key achievements included crossing the 2,000-store mark for Domino’s India, 100 stores for COFFY Turkey, and 50 stores for Popeyes India.

10.Why did Jubilant FoodWorks shares decline despite strong Q1 results?

A. The share decline could be due to broader market conditions or profit booking by investors ahead of the earnings announcement.

Jubilant FoodWorks Q1 Results

Steady Gains: IRFC Q1 Shows Modest Profit Growth Amid Interest Income Challenges!