PHILIPPINE SEVEN CORP., the local operator of 7-Eleven stores, swung to a P493.5-million net loss in the second quarter as an effect of the coronavirus pandemic
In a statement on Thursday, the listed company said it reversed its P373.2-million net income last year due to the temporary closure of some stores, supply chain disruptions and reduced foot traffic when parts of the country were under strict lockdown.
System-wide sales, or the retail sales from all 7-Eleven stores, dropped 31% to P9.92 billion. Sales from existing stores declined by 26% due to the reduction in average customer count.
On a six-month basis, Philippine Seven booked a net loss of P389.7 million, a turnaround of its P485.3-million net profits in the same period last year.
System-wide sales slid 11% to P24.05 billion despite a 10% growth in store count to 2,930 stores.
The company said it was forced to close up to 30% of its stores in the first few weeks of the quarantine, as some workers were unable to report for work due to travel restrictions.
The situation has since improved, and closed stores were less than 10% of its network at the end of June. It was reduced further to 5% last month.
Of the company’s total 2,930 stores, 55% are franchised and 45% are company-owned. Some 2,222 are located in Luzon, 425 are in Visayas and 283 are in Mindanao.
Philippine Seven is approaching the next months with strategies focusing on offering essential products and services. It is also accelerating digital efforts, particularly in e-commerce and payments.
“The company is taking advantage of the strength of its balance sheet. Its cash level remains to be above the normal operating requirements and there are still sufficient credit line made available by the major banks to provide additional liquidity if needed,” it said.
Philippine Seven said in a media briefing in July it was allocating P2 billion for capital expenditures this year, which will support the opening of at least 200 new stores.
Its shares at the stock exchange closed flat on Thursday at P125 apiece. — Denise A. Valdez