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Feb 08, 2011, 12.25 PM IST
Fast food retail chain operator Jubilant FoodWorks posted 66.7% jump in net profit to Rs 18.95 crore for the quarter ended December 31, 2010, compared to Rs 11.37 crore for the same period last year.
Speaking to CNBC-TV18's Udayan Mukherjee and Mitali Mukherjee, Ajay Kaul, CEO of the company said the growth momentum is likely to continue in coming quarters. “We see rise in discretionary food spending,” he added.
Kaul informed that same store sales stood at Rs 18-19% CAGR for the past six-years. “The same stores growth helped topline growth this quarter,” he disclosed.
Going forward, he expects to maintain 16-18% margin range. “Price increase was implemented in November 2010,” he stated.
Q: Great Q3, given what you have delivered in the first 9 months which is just shy of Rs 500 crore on the revenue line what do you think you could finish the year with in terms of sales?
A: We have had a fantastic quarter which continues our performance for the first 9 months as you rightly said. We are the largest MNC food brand today in the country and the fastest growing also. I think the momentum would continue in the next quarter also. If I look at specifically at numbers 58.2% is our system level growth in this quarter which takes our full 9 month at around 58-59%. Our same store growth which is the true health of franchise measure stands at around 35% in this quarter, which is a shade lower than it has been in the earlier two quarters.
A: If I look at the last six years other than this year, our compounded annual same store growth has been around 18-19%. This year has been unprecedented by any standards and by our own standards; we have in the first 9 months delivered around 37% same store growth. We believe such a large number is not sustainable. But whatever we have done over the last 6 years, we believe such numbers are doable. Without putting any number to it, I think this years performance probably is a bit of a one off. But what we have done over the last 6 odd years is something which we should look at.
Q: How much of your incremental revenue growth, going by the example of the last nine months is coming in from new store additions or new franchises. Just want to figure out on top of this core growth that you are talking about same store how much can get added on by new additions even next year?
A: Looking at this quarter itself, our same store growth is around 35.2% and our system level growth is 58.2%. So the differential between the two which is around 23% is clearly stores which have come either last year, or the stores which we have added this year. But to put a number to the new store additions this year, we have added 25 new stores in Q3, which is the highest we have done in the last 3-4 years. So the net new store additions this year so far has been 58. During the full financial year, we hope to add at least 70 new stores and are clearly on track of that.And we believe by March end we will be able to exceed that number.
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