Jubilant Food's pizza goes cold

Jubilant Foodworks is currently down almost 3.5% atRs.1145, after touching an intra day low at Rs.1135. Its 52-week low is at Rs.938.

The stock is down, reacting to the poor show for Q1FY15, with its net profit slipping 18% (YoY) at Rs.28 crore and this was on the due to overall weak operational performance. Total income rose 20% at Rs.477 crore, this was thanks to the opening of more new restaurants, entry into new cities, price hikes and ongoing promotional offers. The company now has stores across 158 cities with 772 restaurants and Dunkin’ Donuts is present across 11 cities with 34 restaurants. The main culprit for the poor show was Same-store-sales which fell 2% v/s a growth of 6.3% in previous Q1. This is the third consecutive quarter where these stores have shown a de-growth. Growth in Q4 had fallen 3.4% and by 2.6% in Q3.

EBITDA was down 11% at Rs.59 crore and margins came down steeper, down at 12.4%, a slide of 440 bps. This fall can be attributed to rise in operating costs, led by employee costs, advertising and promotional cost on development of Dunkin and higher rentals.