McDonald's Corp has posted a positive rise in quarterly sales at its restaurants boosted by strong international sales, especially in the UK and Germany, sending its shares up 3.6 percent.
Global sales at stores open at least 13 months rose 5.5 percent, easily topping the average analyst estimate of 3.94 percent, according to the report.
Same-store sales for what it calls its international lead markets - comprising Australia, Canada, France, Germany and the United Kingdom rose 7.8 percent, surging past analysts' expectation of a 5.30 percent gain.
McDonald's U.S. restaurants also topped sales estimates due to increased customer visits and higher menu prices.
Excluding items, the company earned $1.79 per share, beating the estimate of $1.67.
Net income rose to $1.38 billion, or $1.72 per share, from $1.21 billion, or $1.47 per share, a year earlier.
Revenue fell 9 percent to $5.14 billion but edged past the estimate of $4.98 billion.
Jubilant FoodWorks reported a three-fold jump in net profit to Rs 74.67 crore in the first quarter of the financial year 2018-19 ending June 30 as compared to Rs 23.84 crore the company posted during the same period last year.
Operating revenue for first quarter of the fiscal year 2019 jumped 26 percent to Rs 855 crore. The operator of Dominos Pizza and Dunkin' Donuts reported operating revenue of Rs 678 crore during the corresponding period last year.
The growth was on the back of a strong same-store-growth of 25.9% in Domino’s Pizza, the company said during its earnings announcement.
“We are pleased to start the year on a strong note with our robust performance in Q1 FY19. The strong growth in Domino’s came on the back of a superior product, Value for money delivery and growing digital contribution. This together with our focus on achieving break-even in Dunkin’ Donuts by the end of the financial year will continue to drive profitable growth for us," said Shyam S. Bhartia, Chairman, and Hari S. Bhartia, Co-Chairman, Jubilant FoodWorks.
According to the company, the strong performance in Q1 FY19 was on account of a good response to the Every Day Value offer on Regular Pizzas launched in March 2018, and which was supported aggressively during the IPL T20 cricket season.
“We delivered a strong quarter in both Domino’s and Dunkin’ Donuts. In Domino’s, the extension of EDV to Regular Pizzas received a very good response with an increase in both new customer acquisition as well as existing customer frequency. Dunkin’ Donuts too saw encouraging growth and made good progress towards profitability on the back of successful innovations and disciplined cost management,” said Pratik Pota, CEO and Whole-time Director, Jubilant FoodWorks.
During the quarter under review, the company opened 13 new Domino's Pizza outlets and closed three stores. The company also opened one new Dunkin' Donuts outlet during the quarter.
Tata Starbucks, a joint venture between the Tata Group and Starbucks, posted its first positive Ebitda (earnings before interest, tax, depreciation and amortisation) after sales growth nearly doubled during FY17-18.
Tata Global, in its latest annual report said Tata Starbucks, improved sales by 28% in FY 2017-18 with robust in-store performance and new stores added during the year. With the JV posting sales of Rs 272 crore in FY16-17, a back-of-the-envelope calculation shows revenue to be about Rs 348 crore during the last fiscal. “For the first time since inception, the company recorded a positive Ebitda,” the report added.
The growth is nearly double compared to a year ago period when it mostly focussed on profitability and halted aggressive expansion. However, it added nearly 25 stores last financial year.
The JV narrowed net loss marginally to Rs 30 crore during the year to March 2018 compared to Rs 32 crore a year ago. “Various in-store initiatives and the loyalty programme coupled with the ambience provided in stores resulted in improved existing store performance,” the annual report said.
With 116 stores until March, a back-ofthe-envelope calculation shows that each Starbucks outlet sold coffee, snacks and merchandise worth Rs 3 crore. That’s more than rival Coffee Day Enterprises, which runs the country’s top coffee house chain, Cafe Coffee Day, and had retail revenue of Rs 1,590 crore from 1,722 outlets, or about annual sales of Rs 90 lakh per store. Jubilant FoodWorks, which runs Dunkin’ Donuts and Domino’s Pizza in India, clocked Rs 2.6 crore per store.
Starbucks, which started operations in India in October 2012, recorded the fastest store expansion in the company’s 45-year history in the initial few years.
Also, for global coffee chains including Starbucks, consumers are attuned to a takeaway culture, which helps them add margins at very little cost. In India, however, office-goers and students go to cafes to relax and spend hours over coffee and snacks. Real estate costs in India are high, making it important for retailers to realise average price per square foot of space.
Starbucks expanded its partnership with Tata Group beyond India by launching the latter’s single-origin coffee in the US and Himalayan mineral water in Singapore nearly two years ago.
The iconic American beverage maker PepsiCo’s has posted sales and earnings beating analysts’ estimates in the first quarter, buoyed by increased volumes of Frito-Lay chips as the drinks business continued to struggle.
PepsiCo, like rival Coca-Cola, has focused on introducing new, innovative drinks and products. But it was food brands that drove gains in the quarter.
The beverage-maker had previously said it had shifted its spending too far in the direction of upstarts and away from its biggest names, so it has since refocused attention on its most recognizable labels.
Core earnings were 96 cents a share in the latest quarter, beating the 93 cents that analysts were expecting. Revenue was $12.6 billion, compared with a forecast $12.4 billion. The results are a promising sign, although the North America beverage division is still beset as consumer tastes shift away from colas.
Consumption of carbonated soft drinks fell to a 31-year low in the US in 2016, according to Beverage-Digest, a trade publication. PepsiCo has relied instead on growth in its snack business. Health conscious consumers who have moved away from sugar-laden sodas haven’t made the same moves away from chips.
PepsiCo has also introduced organic and better-for-you versions of some of its biggest snack brands. Growth in the Frito-Lay division helped boost sales in the quarter. The maker of Mountain Dew and Cheetos also benefited from cost cuts as chief executive officer Indra Nooyi continues pursuing at least $1 billion in annual savings.
Beverage maker Coca-Cola has claimed unit case volume growth of 5% for the January-March ’18 quarter for the Asia-Pacific region, which it said was driven by ‘strong performance’ in China and India, partially offset by a low single-digit decline in South East Asia.
“Operating income growth outpaced revenue growth for the quarter, largely driven by favourable product mix as sparkling soft drinks grew volume double digits in China and India,” the Atlanta-based firm said in an earnings statement. It said its price/mix declined 2% for the quarter, largely driven by negative geographic mix as growth in China and India outpaced more developed markets, the maker of Coca-Cola and Thums Up aerated drinks, Minute Maid juice and Kinley water said.
The company has been working to counter headwinds through pricing and product innovations. “We've been learning over the last couple years. We came out with some good marketing, some reinvigorated packaging, shapes, sizes, and looks, and obviously ... innovation on the flavours," chief executive James Quincey said.
French liquor company Pernod Ricard has claimed to have recorded a sales hike of 14% for the first nine months (July 2017-March 2018) of its fiscal compared with just 1% in the year-earlier period, which suffered from dwindling sales due to the impact of demonetisation.
The world’s second-biggest spirits maker behind Britain’s Diageo said global sales rose 6.3% organically to about 7 billion euros, helped by higher revenue from Asia that rose 10%. The company attributed the Asia growth to the early onset of the Chinese new year and “strong growth” in India. Asia contributes 42% to the top line.
With the “highway ban now fully implemented, no further disruption (is) expected. We are awaiting clarification from the GST council as to the scope of tax application,” the company said in an investor presentation on Thursday. This statement is in reference to the Supreme Court’s move to ban liquor outlets within a distance of 500 meters from highways.
GST doesn’t include the alcoholic beverage industry. But raw materials used to fall under its ambit thereby pushing up input costs for the industry. Pernod, the maker of Imperial Blue and Royal Stag whiskey, has strategic international brands which include Absolut Vodka and Chivas Regal Scotch. It sells wines under labels such as Jacob’s Creek, and Brancott Estate in the country.
Zomato’s founder and CEO Deepinder Goyal has announced a revenue jump in gross revenue to US $74 million in FY18 from US $51 million in FY17 giving a total rise of 45 percent.
Goyal made the announcement via company’s official blog Zomato Blog. The company’s operating burn (loss) dropped 26 percent to US $11 million in FY18 from US $15 million in FY17. Of the US $11 million burn, US $6 million were incurred in two months February and March this year when the company decided to double down on growth.
“We demonstrated that our business can generate profits – almost all throughout the year, we hit EBITDA break-even globally, across all our business, and while maintaining good growth levels; and then in the last two months, we decided to double-down on growth (more on that later),” wrote Goyal.
The food ordering accounted for 30 percent of the company’s revenue in FY18, when compared with 18 percent in FY17. Goyal in the blog claimed that company reached the 5.5 million mark in terms of monthly food orders in March 2018. In a short period of time, Zomato Gold now contributes 12 percent of the monthly revenue.
“We are excited about Zomato Gold and are very soon taking it to more cities and also expanding our membership base as fast as we can,” Goyal said.
Zomato clocked revenues worth Rs 60.7 crore in online ordering in FY17 forming about 19 percent of its business last year.
“As we enter a new financial year, we are extremely excited and pumped and hope we can add more value to our restaurant partners and keep delighting our users in the coming years. We are currently at an annualized revenue run rate of US $100m. And looking at the last two months (our revenue in March is 35 percent up from January), if the momentum continues, we will be recording one of our best years in business. And the team is very adamant to continue (and even further increase) this momentum,” Goyal concluded.
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