Max’s Group Inc., the casual dining restaurant operator, said it had a net loss of P700 million last year from the previous year’s income of P724.22 million, as the pandemic affected most of its operations despite the easing of lockdown measures.
The company recorded total systemwide sales of P10.85 billion generated by both company-owned and franchised stores, a 46-percent decline versus the P20.11 billion in 2019. Revenues were cut in half to P7.14 billion from the previous year’s P14.4 billion.
Systemwide sales for the fourth quarter alone fell 46 percent to P3.01 billion from the previous year’s P5.57 billion. Revenues for the quarter reached P1.94 billion.
“This extraordinary year was a reflection of the global restaurant industry performance amidst the Covid-19 pandemic,” Max’s President and CEO Robert Ramon F. Trota said.
“Nevertheless, we have taken this opportunity to overhaul our operating structure for a nimbler future. We have chosen to focus on our core brands of Max’s Restaurant, Yellow Cab Pizza Co., Krispy Kreme and Pancake House to maintain market relevance through channel and menu innovation, while likewise optimizing our store network and overall cost structure.”
He said the continued shift in pandemic restrictions drove the volatility of local performance. The government easing of dine-in restrictions from June onwards provided a strong upside over the second half of the year, a brief pause via a two-week modified enhanced community quarantine (MECQ) in Metro Manila and parts of Luzon notwithstanding.
“Core off-premise channels such as delivery and take-out performed at indices exceeding even pre-pandemic levels, proving that consumer demand for our portfolio of most-loved brands remains more vibrant than ever,” he said.
Max’s international business also exhibited an upward trend with systemwide sales increasing by 9 percent in the fourth quarter. It dipped 25 percent from the previous year, the company said.
“More than ever, we are thankful for a seasoned, agile management team. Amidst the steep operating losses from the first two quarters of the pandemic, we chose to be decisive in taking these uncertain times as an opportunity to restructure and re-skin our identity as a business to take advantage of tomorrow’s growth,” Trota said.
Overall initiatives to optimize both costs and cashflow were key in the company’s gradual but sustained recovery. The focus on core brands was essential to these efforts, while it balances its marketing investments, building up supply chain efficiencies, inventory management and utilization, menu margin management, ramping up collection of receivables, head office relocation, rightsizing of staffing and alliances with lessors on rental concessions, the company said.
Total expenses for the fourth quarter decreased by 21 percent versus the same period last year and 18 percent for the full year, net of one-off restructuring costs and impairments. As of end-2020, the company’s store network totaled 14 territories, with 604 Philippine sites and 59 stores situated across various locations in North America, the Middle East, and Asia. Out of these 663 stores, 95 percent or 630 stores were operational.