JOLLIBEE Foods Corp. (JFC) expects achieving payback on its acquisition of South Korea’s Compose Coffee within five to six years, a company official said.
“Even if we take a very modest growth rate, just based on new franchisees, roughly 30 to 40 new franchisees per month are opening stores. If you just add that in, you get to a decent growth rate. With that growth rate, there’s no reason why, in five to six years, we should not be able to hit payback on this (Compose Coffee),” JFC Chief Financial Officer Richard Shin said in a virtual briefing on Thursday.
“In terms of reaching break-even, because it’s quite lucrative and profitable purely from the cash that it generates, we will likely have a very quick payback. We’re looking at it more from the return on invested capital (ROIC) perspective,” he added.
Earlier this month, JFC announced the acquisition of Compose Coffee for $340 million to bolster the company’s coffee and tea business. The company expects to complete the acquisition by the first half of August.
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