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Tony Tan Caktiong doesn’t need to envy Enrique Razon. He needs to copy the part investors reward: high-quality international earnings.
There’s a popular shorthand in Philippine equities: “international expansion = premium valuation.” But the market’s latest verdict on ICTSI and Jollibee Foods Corporation (JFC) suggests something more precise—almost unforgivingly so. Investors aren’t paying for international presence. They’re paying for the quality of international earnings. And right now, ICTSI’s overseas footprint looks like a cash machine; JFC’s looks like a work in progress—still impressive in reach, but uneven in profitability and heavier in financial baggage.
Start with the scoreboard investors see before anything else: market value. As of early January 2026, the Philippine Stock Exchange data show ICTSI at roughly ₱1.217 trillion in market capitalization, while JFC sits around ₱205.5 billion—a gap of nearly six-to-one in size. That’s not a small valuation disagreement. That’s the market putting these two globalizers into entirely different categories: ICTSI as a global infrastructure franchise; JFC as a global consumer platform still proving the consistency of its returns.
Two companies, two globalization models—and two very different “earnings engines”
ICTSI’s international model is essentially concession-based infrastructure: secure long-duration operating rights, grow throughput, monetize with tariff and mix improvements, and keep margins structurally high. The latest filing shows it operating 33 terminals in 19 countries, with expansions and extensions like Batam (Indonesia) and Kribi (Cameroon) supporting portfolio growth.
JFC’s international model is brand portfolio scaling: open stores, acquire concepts, expand franchising, invest in supply chains, and win customers repeatedly across many cultures and competitive contexts. Its latest report shows 10,304 stores globally, with 6,859 international—a footprint that would have sounded like a “sure rerating” story a decade ago.
But again: the market is not grading footprint. It’s grading earnings quality. And earnings quality is where the divergence becomes obvious.
ICTSI: International growth that scales—and converts into profit
ICTSI’s latest 17‑Q reads like the kind of operating report that makes portfolio managers loosen their valuation discipline. Consider the core KPI for a port operator: volumes. Nine-month 2025 throughput reached 10.687 million TEUs, up from 9.604 million the year before—growth that’s broad-based across regions (Asia, EMEA, and the Americas).
More importantly, revenue rose faster than volume, a telltale sign of pricing/mix power. Gross revenues for nine months climbed to US$2.338 billion from US$2.013 billion, with all three geographic segments contributing. In infrastructure businesses, this matters more than the raw volume number: it signals that growth isn’t just “more boxes,” but better economics per box.
Then comes the clincher: profit conversion. ICTSI reported nine-month EBITDA of about US$1.544 billion, up from US$1.316 billion, and net income attributable to equity holders of US$751.6 million, up from US$632.6 million. That is exactly what investors pay for: an international expansion engine that not only grows, but throws off rising cash earnings while it grows. It’s why ICTSI is being talked about in market commentary as a “trillion‑peso premium” stock—because its operating math looks durable.
Even the expansion narrative here is “market-friendly.” ICTSI’s additions and extensions—like taking over operations of Batam Terminal in September 2025—slot into a portfolio that already has scale and operating discipline, while its capex is visible and tied to throughput/asset upgrades. The investor mental model is simple: more terminals + more volume + pricing levers = more earnings, and the last quarter’s results keep validating that model.
JFC: A global footprint that’s growing—but with uneven traction and heavier financing costs
JFC’s latest filing, to be clear, is not a failure story. It is a story of scale. System-wide sales grew 18.4% year-on-year for nine months to ₱332.8 billion, and Q3 system-wide sales grew 16.8% to ₱115.1 billion. That is real demand growth—especially in a world where food inflation, consumer trade-down, and competitive discounting can quickly compress restaurant margins.
But the market is not questioning whether JFC can grow revenue. The market is questioning how cleanly that growth becomes equity earnings, especially outside the Philippines.
First, look at the shape of international performance. The filing indicates China system-wide sales declined (–0.8%) over nine months, while North America rose only +2.0%, even as other regions like EMEA (+20.0%) and international overall (+31.6%) lifted the headline. A globalization story with pockets of stagnation (China) and muted growth (North America) doesn’t get a uniform premium—especially if those pockets are strategically important.
Second, the store network shows expansion—but also churn, where the market cares most. China’s store base shows a net decline of 11 stores (closures outpacing openings), and North America shows a net decline of 14 stores. Closures can be prudent portfolio management, but they also signal execution variability: not every market is scaling smoothly, and not every format is compounding as planned.
Third—and this is the balance-sheet line item that often decides reratings—financing costs are rising quickly. For nine months, JFC’s interest expense increased about 47.9% to ₱5.04 billion, while net income rose only 1.6% to ₱9.02 billion. In other words, more of the operating progress is being absorbed by capital costs, which is the opposite of the ICTSI narrative, where growth appears to be widening profit pools.
The balance sheet confirms why. JFC’s senior debt securities increased (to ₱52.1 billion), and short‑term debt more than doubled (to ₱13.8 billion). That doesn’t automatically mean danger—but it does mean the market will demand stronger proof that international earnings will scale after interest, after reinvestment, and after currency and integration volatility.
And volatility is present: JFC reported negative translation impacts versus the prior year, underscoring how currency movements can distort global earnings and equity, especially when profit margins are thinner. Infrastructure cashflows can also face FX risk, of course—but ICTSI’s very high EBITDA margin structure tends to make markets more tolerant of macro noise.
Why the valuation gap persists: “Earnings quality” is the market’s common language
So why does ICTSI earn the trillion‑peso badge while JFC, with arguably the more consumer-visible international brand presence, trades at a much smaller capitalization? Because the market’s preferred globalization has three characteristics:
- Broad-based growth that isn’t hostage to one country. ICTSI’s volume and revenue growth are spread across regions.
- Pricing power/mix benefits that show up in revenue outpacing volume. ICTSI demonstrates this; it’s a hallmark of franchise-like infrastructure.
- Clean conversion of growth into profit and cash—even while investing. ICTSI’s rising EBITDA and net income reinforce this narrative.
JFC, meanwhile, is delivering admirable scale and sales momentum, but investors are waiting for more consistent proof on two fronts:
- International markets that are still mixed (China and North America)
- A capital structure where rising interest expense is eating into earnings momentum
This is why the market-cap gulf is so stark: ICTSI’s international earnings look “high quality” (repeatable, high margin, scalable), while JFC’s international earnings still look “transitional” (growing, but uneven, and more financially encumbered).
The forward-looking question: Can JFC make the market pay for quality, not just scale?
If JFC wants a rerating that resembles ICTSI’s, the task is not to “expand internationally”—it already has. The task is to raise the quality of international earnings: stabilize China, strengthen North America economics, and slow the rate at which financing costs dilute operating gains.
ICTSI’s challenge is the inverse: once you’re priced like a global infrastructure franchise, you must keep proving the franchise. That means sustaining throughput growth, protecting yield, and making capex translate into incremental earnings. Its latest numbers suggest it is doing that—hence the market’s willingness to pay.
In the end, the market’s message is refreshingly unsentimental: global presence is a strategy. Global earnings quality is the prize. And today, the prize is being awarded far more generously to ICTSI than to JFC.
If Tony Tan Caktiong wants ICTSI’s valuation aura, the lesson from Enrique Razon is simple: footprint is optional; earnings quality is priced.
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