Financial Performance Drops, Pizza Hut Closes 20 Outlets And Lays Off 371 Employees

JAKARTA - The parent company of the Pizza Hut franchise, PT Sarimelati Kencana Tbk (PZZA) reported that it had closed 20 outlets until September 30, 2024. As a result, the company has unraveled 371 employees.

In the third quarter-2024 (unaudited) financial report submitted through the IDX's Public Information Disclosure, management reported that with the closure of 20 outlets, the remaining number of outlets is currently 595 out of 615 outlets.

The closure of the outlet was also accompanied by a reduction of 371 employees until September 2024.

"On September 30, 2024 and December 31, 2023, the company has 4,651 and 5,022 permanent (unudited) employees," the financial report reads, quoted on Tuesday, November 19.

In addition, net sales of ready-to-eat restaurants also recorded a decline. In the third quarter of 2024, Pizza Hut sales were recorded at IDR 2.03 trillion or lower than the same period the previous year, which was IDR 2.75 trillion.

Meanwhile, the company's net loss for the year reached IDR 96.7 billion as of September 2024. This figure swelled when compared to the same period the previous year, which was IDR 38.9 billion.

Still citing IDX's disclosure of information, Sarimelati Kencana Operations Director Boy Ardhitya Lukito revealed the current condition of the company. He said there were two pressures in running his business.

Furthermore, he said the external pressure was a decrease in people's purchasing power and economic pressure caused by geopolitical tension in the Middle East.

"First, from the economic conditions that occur in Indonesia itself, which both see not only affecting Pizza Hut but also other business industries from the middle economy that have dropped class and that is also different from geopolitical," said Boy.

"Of course, because it's mixed, we can't separate which one is bigger and which one isn't," he continued.

Not only that, Boy also admitted that he saw the response of the community regarding the geopolitical conflict that had an impact on the company. However, Boy did not directly mention the boycott.

"But if the impact of geopoliticals can be seen from our social reasoning, there has been a decline from that initial time. But we can't separate which one is bigger and which one is smaller," he explained.