Shakey’s Pizza surpasses pre-pandemic systemwide sales in 1H22, Finishes strong with an 18-fold bottomline increase

Shakey’s Pizza Asia Ventures, Inc. (PSE:PIZZA), the Philippines’ leading fast casual restaurant chain and food service group, finished the first half of 2022 strong, with systemwide sales of Php 5.8 billion surpassing pre-pandemic levels and demonstrating a 77% year-on-year increase. Same-store sales pick up with a year-on-year growth of 23% for the period.

PIZZA further accelerated in the second quarter of 2022, as systemwide sales more than doubled compared to the same period last year, reaching Php 3.6 billion, while same-store sales rose by 41%.

The robust performance follows a strong Philippine economic reopening during the first half of the year, resulting in the resurgence of dine-in sales. All brands posted strong growth for the period.

Moreover, second quarter performance captured the full impact of PIZZA’s latest acquisition, Potato Corner (PC), one of the leading kiosk-based food brands in the country. The Company took over PC operations in March 2022.

Vicente Gregorio, President and Chief Executive Officer of PIZZA, said, “At the height of the pandemic, we made the strategic decision to continuously invest in the expansion of our store network and our portfolio with this reopening in mind. Above all, we deliberately invested in brand-building and delivered more value for our guests. Fast forward to 2022, we are very pleased to see these investments begin to pay off.”

In addition, gross profit increased to Php 1.0 billion, up by 75% in the first half versus the same period last year. Resulting gross margins saw an expansion of 210 basis points, landing at 24.3%, amidst an elevated cost environment. This was primarily driven by a stronger topline, PIZZA’s favorable mix, as well as menu optimization initiatives.

The growth in gross profits flowed through to the earnings before interest, taxes, depreciation and amortization (EBITDA), which, at Php 728 million, registered an 80% year-on-year increase for the first six months. EBITDA margin jumped by nearly 200 basis points to 17.8%. Overall, net income landed at Php 250 million, ballooning eighteenfold from last year’s Php 14 million.

According to Gregorio, the Company is expecting the growth momentum to accelerate as it enters the second half of 2022, especially with the resumption of face-to-face classes and the seasonality impact of the fourth quarter holidays.

In early 2022, PIZZA declared an unprecedented CAPEX budget of Php 650 million for the year. This will be primarily used for store network expansion for its Wow Brands, which include core brand Shakey’s Pizza, the fast-growing Peri-Peri Charcoal Chicken & Sauce Bar, emerging brands R&B Milktea and Project Pie, and new growth pillar Potato Corner. The Company plans to open about 40 stores for its core and emerging brands and 150 stores for Potato Corner in 2022. Year-to-date CAPEX amounted to Php 288 million.

“Despite headwinds, we have a strong underlying business momentum and mitigating plans in place, coming from the lessons learned during the pandemic. With Potato Corner fully onboard, synergies in our ecosystem, structural changes implemented, and the continuous pursuit for new sources of efficiencies, we have a full armada that will bring our 2022 bottomline close to pre-pandemic levels. PIZZA is going full steam ahead,” he concluded.

Disclaimer:
This press release includes forward-looking statements. Such forward-looking statements are management’s present expectations of future events and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

The reader is cautioned not to rely on such forward-looking statements, which speak only as of the date they were made. All subsequent forward-looking statements attributable to the Company, its affiliates or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements referred to in this press release.

About PIZZA:
Shakey’s Pizza has been creating over 40 years of great times and great memories. It is one of the leading Fast Casual Restaurants in the Philippines, focused on family casual dining. It maintains market leadership in both the chained pizza full-service and chained full-service restaurant categories.

Peri-Peri Charcoal Chicken and Sauce Bar is an emerging fast-casual and full-service restaurant brand in the Philippines. Its mainstay is charcoal-grilled chicken, marinated for 24 hours, served with an assortment of unique sauces to choose from. Since its acquisition in 2019, PIZZA has already doubled the store footprint of Peri-Peri.

PIZZA owns the master franchise of R&B Milk Tea in the Philippines. R&B Milk tea is one of the leading milk tea players in Singapore. It is available in Shakey’s stores and now has two independent stores, one of which is the first drive-through milk tea store in the country.

In 2021, PIZZA relaunched Project Pie, a modern and upscale pizza concept and an artisan pizza chain known for its build-yourown pizzas.

In 2022, PIZZA acquired Potato Corner, one of the leading food kiosk brands in the Philippines renowned for its flavored fries. Potato Corner has over 1,000 stores in the Philippines and a wide store network internationally.