THE exclusive licensee of 7-Eleven convenience stores in the Philippines booked a 16.2% profit increase in 2018, as the tax reform program imposed at the beginning of the year further boosted earnings.
In a statement issued Thursday, Philippine Seven Corp. (PSC) said net income stood at P1.53 billion last year, higher than the P1.32 billion it posted in 2017. Systemwide sales grew by 22.9% to P46.13 billion, supported by same-store sales growth of 8.8%
In the fourth quarter alone, the listed firm said net income jumped 18.9% to P796.4 million, on the back of a 25.6% increase in systemwide sales to P13 billion.
“The full-year story is one of strong same-store sales growth driven by a tax cut that most benefited the lower middle class, who over-index in our stores,” PSC President and Chief Executive Officer Jose Victor P. Paterno said in a statement.
Mr. Paterno further attributed the growth to the additional excise tax on sugar-sweetened beverages, which “narrowed relative price differences between mass market and premium products, the latter of which are overrepresented in our stores.”
The company also noted that they observed no significant decline in volume even while the Tax Reform for Acceleration and Inclusion Law raised prices of goods.
PSC ended the year with a total of 2,550 stores, 11.6% higher than its store count in 2017. Of this, 1,965 are located in Luzon, 365 are in Visayas, and 220 are in Mindanao. The ratio between franchised to company-owned stores stood at 55%-45% by end-2018.
Mr. Paterno said they are also working on boosting their food service business, as well as improve their fast-moving consumer goods items in the future. — Arra B. Francia