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Inflationary pressures seem to have weighed down on Jubilant FoodWorks Ltd with the company reporting a marginal 2.78 per cent increase in its standalone net profit at Rs 33.24 crore for the second quarter ended September 30, 2013-14.
The company posted Rs 32.34 crore profit in the corresponding period a year-ago.
Net sales, expenses
Net sales rose 27.64 per cent to Rs 436.6 crore during Q2, 2013-14, from Rs 342.03 crore in the year-ago period.
The company’s expenses during the quarter increased 30.98 per cent to Rs 389.3 crore from Rs 297.22 crore in Q2 of last fiscal.
Price hike by mid-November
Ajay Kaul, CEO, Jubilant FoodWorks Ltd, said during an investor call that the company will undertake a five per cent price hike by mid-November.
"We normally undertake a three per cent each year. However, this year we will be undertaking a five per cent price hike to tide over the inflationary pressures,'' he said.
Kaul added that H1 has been a challenging period for the industry. “The short-term challenges on the inflationary front and around lower discretionary spends are manageable,” he said.
The company said it has opened 30 new restaurants in Q2 FY'14. Currently, it has has 632 stores.
Online platform
Kaul said that the company is betting big on online ordering platform.
He said despite cost pressures, the company has revised its target to open 135 Domino’s Pizza restaurants in FY'14 compared with 125 earlier, of which the company has opened 74 restaurants as of October 31, 2013.
It plans to add 20 new Dunkin’ Donuts restaurants compared to the earlier target of 18.
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