In the third quarter of 2020 Jollibee (JFC) recorded a net loss of 1.9 Billion Pesos. Although JFC was still in the red, it managed not to burn cash on operating activities during the period. Total cash burned on operating activities for the nine-month period remains at 5.2 Billion Pesos as no further cash was burned in the third quarter.
JFC not anymore burning cash on operations is welcome news. Around 19.9 Billion Pesos of debts are up for repayment in the near term. That is not counting the lease liabilities due in the near term of 4.7 Billion Pesos.
Those debts could eat a significant portion of JFC’s cash. As of the end of the 9M20, JFC has a cash balance of 20 Billion Pesos after 37 Billion Pesos of cash has been invested in short-term financial assets. JFC’s cash balance has been boosted by its capital raising activities early in the year. JFC raised 30.4 Billion Pesos of senior perpetual capital securities and 29.5 Billion Pesos of senior debt securities early in the year.
JFC has secured the cash to weather the storm in the meantime. Until JFC turns in cash from operations, JFC is a thriller.
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Disclaimer and Disclosure: This analysis is an independent viewpoint on publicly traded stocks in the Philippine market. Accuretti Systems Inc. trades stocks in the Philippine market.