InvestorQ : Why did Jubilant Food numbers suffer in the Sep-20 quarter? Are the demand for pizzas going down?
Niti Shenoi made post

Why did Jubilant Food numbers suffer in the Sep-20 quarter? Are the demand for pizzas going down?

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2 months ago
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For the Sep-20 quarter, Jubilant Foodworks reported 18.21% fall in sales at Rs.816 crore. Jubilant is the Indian franchise for Domino’s Pizzas and Dunkin Donuts. It is not about demand going down but the social distancing and movement restrictions are having an impact. That is the main reason and it is not that people don’t want to eat pizzas!

Operating profits were down 25.3% at Rs.111 crore. The lower operating profit was because lower sales gets immediately transmitted into lower profits, despite a sharp cut in the cost of raw materials. OPM fell from 14.90% in the Sep-19 quarter to 13.60% in Sep-20 quarter.

PAT for the Sep-20 quarter was up by 3.84% at Rs.76 crore due to higher taxes and exceptional losses in Sep-19 quarter. PAT margins expanded from 7.31% to 9.28% in Sep-20 quarter. As part of its rationalization, Jubilant shut down 105 outlets including 100 Dominos and 5 Dunkin Donuts. Its profits depend on higher same store sales or else stores need to be shut as they would not justify costs.

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