MANILA - Jollibee Foods Corp said Wednesday it incurred a net loss of P10.2 billion in the second quarter due to the impact of COVID-19 lockdowns and its business transformation plan.

The group posted a P1.04 billion profit in the same period last year.

The net loss is inclusive of its business transformation program of P7 billion as well as costs incurred from crisis emergency response, JFC said in a disclosure to the stock exchange.

“The business results were very bad but in line with our forecasts. We are now focusing on rebuilding our business moving forward along with implementing major cost improvements under our Business Transformation program," JFC CEO Ernesto Tanmantiong said.

The business transformation plan includes closure of 255 company-owned stores, change in ownership of 95 stores, pre-termination penalties in US and China and closure of supply chain facilities, among others, said JFC chief financial officer Ysmael Baysa.

The move will help Smashburger and Coffee Bean & Tea Leaf become profitable by 2021, he said.

• Coffee Bean & Tea Leaf, Smashburger brands 'profitable' by 2021: JFC

System wide sales from both company-owned and franchised stores declined 48.3 percent to P30.7 billion in the second quarter compared to the same period in 2019 due to the full impact of COVID-19 restrictions, the country's largest restaurant operator said.

The island of Luzon was placed under lockdown in March, that saw most businesses shut and with restaurants reduced to offering delivery and take out. Metro Manila and other key provinces are still under modified enhanced community quarantine until Aug. 18.

Some 50 percent of the group's stores worldwide were shut at the beginning of the quarter, JFC said. Operations have been gradually reopening globally, it said.

Sales and profit are expected to improve in the next few months, Tanmantiong said. Financial performance will be better in the next 2 quarters, the operator said.

JFC plans to open 338 stores globally this year which will boost profits "significantly in 2021," it added.

JFC operates 3,286 outlets in the Philippines and 2,588 stores abroad.

• Jollibee slashes 2020 capex, sees 'slow recovery' as virus hampers growth