MCD in the Philippines, Jollibee, and the others

Part 2

Disclosure: I do not have shares in any of the companies mentioned in this article and don’t plan to initiate purchase within the next 24 hours. I would not receive any compensation for doing this article. I am not a professional financial analyst. This is just a hobby. Lastly, my work is not error-free, but I strive for it to be.

If you are interested in this similar approach to investing I wish to invite you to this Facebook group



Seeking financial information for McDonald’s (MCD) operation in the Philippines can be tricky. MCD operations in the Philippines is being run by two companies. These two companies are the Alliance Global Incorporation (AGI) with 44% and by the Golden Arches Development Corporation (GADC) with 56% ownership.

There are over 408 (as of 2013’s annual report) MCD restaurants in the Philippines compared to Jollibee’s (JFC) 2,301. Thus, MCD-Philippines would definitely be overshadowed by JFC’s revenue and net income numbers.

With the aforementioned information, it is definitely not enticing to invest in AGI just to have ‘some’ exposure in the MCD operation in the Philippines. AGI is a conglomerate. It owns several other companies that would reflect in its consolidated financial statements. See this AGI’s 2013 annual report to see the breakdown of its companies (

For fun, on August 20, 2014, GADC (56% owner of MCD in the Philippines) reported a 15.25% decline in net profit for the first six months to 322 Million pesos. That would be roughly 644 Million pesos for MCD Philippines while JFC had 5,362 Million pesos that FY year.


(CORRECTION: GADC has 56% ownership that represents the 644 Million net profit, upon estimation with AGI’s 44%, total net profit should be at 1,150 Million or see chart)


Okay, I guess MCD does not have that much clout in the Philippines as I had initially assumed. Maybe I can now safely assume that Pinoys do really want their Chickenjoys over Big Macs. Maybe that’s why I also had to pay ‘premium’ price just to have its 2 piece chicken for dinner priced at $6.99 when in a trip in LA, CA.


I tried to find what company/ies would be good to compare JFC with given its dominance in the Philippines’ fast food industry. This led me to Max’s Group Incorporated (MAXS). (Unless provided with better company to compare with).

A review, as of December 31, 2014, JFC operated 2,301 restaurants in the country under the brands Jollibee, Chowking, Greenwich, Red Ribbon, Mang Inasal and Burger King.

MAXS, on the other hand, has more brand/restaurants under its name. These are Max’s Restaurant, Pancake House, Dencio’s, Kabisera ng Dencio’s, Teriyaki Boy, Sizzlin’ Pepper Steak, Le Coeur De France, Maple, Yellow Cab, Krispy Kreme, Jamba Juice, and The Chicken Rice Shop.


Max’s restaurant started to open its first store in Quezon City, Philippines in 1945. Yup, older than JFC and MCD. JFC started in 1978, while MCD started serving its first customers in 1955.


In addition to these facts, the Max’s restaurant has only 159 stores nationwide as of 2014. Looking at its 2014 annual report, information revealed that the MAXS group had a total of 542 stores in operation nationwide. This is only 23.55% of JFC’s 2,301 stores in the Philippines. Talk about JFC’s dominance.

Although JFC appears to be aesthetically better than MAXS, an investor would be interested in learning the value behind each company.

Sadly, this will end part 2’s article. Click on Part 3 to see comparison between JFC’s and MAXS’ financial performance within the past five years.

Part 1 Jollibee or McDonald’s shares, which is better?


Part 3 MAXS or Jollibee,  which is better?


If you are interested in this similar approach to investing I wish to invite you to this Facebook group


Mark Y.

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