Jubilant FoodWorks posts net loss of Rs 74.5 cr in Q1, revenue declines 59%

JFL's total expenses fell 41.54 per cent to Rs 499.03 crore during the quarter under review as against Rs 853.71 crore a year ago.

Jubilant FoodWorks Ltd, which operates fast-food chains Domino's Pizza and Dunkin' Donuts, on Wednesday reported a consolidated net loss of Rs 74.47 crore for the first quarter ended June 2020, impacted by closure of stores due to COVID-19 pandemic and consequent lockdown.

The company had posted a net profit of Rs 71.48 crore in April-June quarter a year-ago, Jubilant FoodWorks Ltd (JFL) said in a BSE filing.

Its revenue from operations declined 59.07 per cent to Rs 388.41 crore during the quarter under review as against Rs 949.11 crore in the corresponding quarter last fiscal.

"The impact of COVID-19 was felt severely in Q1 FY21. The nationwide lockdown led to a complete closure of stores initially, with dine-in and takeaway remaining closed for most of the quarter," JFL said in a post earning statement.

JFL's total expenses fell 41.54 per cent to Rs 499.03 crore during the quarter under review as against Rs 853.71 crore a year ago.

The company enacted several measures to contain the impact of operating de-leverage.

"Cost-optimisation measures like reduction in store operating costs, rent renegotiation, variabalizing of store manpower cost along with significant cut down of fixed and discretionary expenses helped partially mitigate the adverse impact on profitability," it said.

It leveraged supply chain network, vendor partnerships and logistics set-up to ensure uninterrupted supply of raw materials to the stores.

"This allowed us to reopen our stores swiftly for delivery - Domino's was amongst the fastest to reopen restaurants with over 78 per cent of the network resuming operations by June," it said.

This helped JFL's revenue from operations, which recovered 40.5 per cent over last year.

"This was led by the delivery channel which showed a recovery of 66.7 per cent. The revenue recovery improved significantly in the subsequent months, with a recovery of 69.8 per cent in July and 84.6 per cent in August," it said.

According to JFL, both - delivery and takeaway channels - recovered fully by August and delivered a year on year growth, with delivery channel growing at 110.9 per cent LFL (like-for-like) and takeaway at 161.0 per cent LFL.

JFL CEO Pratik Pota said, "Our revenue recovery in July and August was encouraging, and we had returned to growth in the delivery and takeaway channels by August. We are excited about the future and confident that we will emerge from this crisis stronger than ever before."

During the quarter, JFL opened 24 new restaurants of Domino's Pizza, adding six cities in its network. It also closed five stores of Domino's Pizza in April-June quarter.

The company was operating a total of 1,354 stores at the end of the quarter.

It also closed four Dunkin' Donuts restaurants, bringing the total stores to 30 at the end of the quarter from 34 at the beginning of the period.

On outlook, JFL Chairman Shyam S Bhartia and co-chairman Hari S Bhartia said, "While the operating environment continues to remain highly uncertain, we are hopeful that normalcy will return by year-end."

Shares of Jubilant FoodWorks Ltd on Wednesday closed 3.87 per cent higher at Rs 2,231.70 on the BSE.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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