High raw material cost along with enhanced expenditure on promotions and advertising pulled down the net profit of Jubilant FoodWorks by 10% to Rs 33.6 crore for the third quarter ended December 31.
Total income was up 18.5% at Rs 456.6 crore in the period. However, same store growth (SSG) of the quick service restaurant firm, which runs Domino's Pizza and Dunkin' Donuts in India, declined 2.6% on the back of a tepid economic environment and consumers’ constrained discretionary budgets. SSG were up 16% in the corresponding quarter last year.
Ebitda growth in the quarter moderated to stable levels owing to a combination of inflation and decline in SSG. Margins correspondingly were lower at 14.8% compared with 17.4% in the year-ago period. “The food service industry is in flux with the shadow of macro-economic deceleration, giving us a consumer who has much less propensity to indulge in this category. A combination of inclement factors is hampering SSG but we believe this is a function of external phenomenon,” said Ajay Kaul, CEO. The firm incurred a total expenditure of R389 crore, up 22.4%.