7-Eleven PHL’s sales get boost from TRAIN law
PHILIPPINE Seven Corp. (PSC) saw its profits jump 20.5% in the first quarter, driven by higher sales at its network of 7-Eleven convenience stores which was attributed to the “favorable” impact of the tax reform law.
In a regulatory filing, the Philippine licensee of 7-Eleven convenience stores reported its net income rose to P190.5 million during the January to March period, from P158.1 million in the same period in 2017.
“The increase in net income can be attributed to the 12.9% growth in same store sales brought about by the favorable impact of the new Tax Reform for Acceleration and Inclusion (TRAIN) Act and the earlier timing of the Holy Week, which fell on the first quarter this year,” PSC said.
Starting Jan. 1, the TRAIN Act reduced personal income taxes for those earning below P2 million. However, the law also increased tax rates for tobacco and automobiles, among others, and imposed excise tax on sugar-sweetened beverages (SSB).
“This improved the disposable income of the middle class and contributed to the higher customer count of the stores. Moreover, the excise tax on SSB resulted into increased prices of sweetened beverages; however, there was no drastic reduction in volume seen during the first quarter,” PSC said.
The listed firm reported system-wide sales, which cover sales of corporate and franchise-operated stores, jumped 26.8% to P10.6 billion during January to March period. Revenues from merchandise sales, which are retail sales of corporate stores and merchandise sold to franchised stores, increased by 28%.
This was attributed to the 14.7% increase in the number of operating stores to end the first quarter with 2,329 stores around the country. The bulk or 1,828 of the stores were in Luzon (including 889 in Metro Manila), followed by 322 in Visayas and 179 in Mindanao. Of the total, 53% are controlled by franchisees, while the rest are corporate-owned.
“PSC continued to dominate the convenience retail sector by opening new stores all throughout the country. It capitalized on its first-mover advantage and economies of scale in widening its lead against competitors. The capacity building expenditures made in the form of establishing new distribution centers and regional headquarters are starting to produce favorable results,” the company said.
PSC is setting aside at least P3.5 billion in capital expenditures this year, as it plans to further expand its store network and renovate existing stores.
Wilcon Depot books P409M in January-March period
WILCON DEPOT, Inc. posted 5% earnings growth for the first quarter of 2018, following higher sales from its depot format stores during the period.
In a statement issued Tuesday, Wilcon said it booked P409-million net income during the three-month period. Net sales of the company improved by 12.5% to P4.71 billion, which the company said was achieved despite a higher base in 2017 and less number of operating days during the January to March period.
Majority of the company’s sales came from its depot format stores at P4.56 billion, while the smaller home essentials format provided P147 million.
“Wilcon is on track to achieve its 2018 net sales target of mid to high teens and has already breached its product mix target of 46% net sales contribution from its higher margin products. We expect to sustain this momentum until the end of the year as we push for the timely opening of new stores and continued marketing efforts to boost comparable sales growth,” Wilcon Chief Finance Officer Mark Andrew Y. Belo said in a statement.
Comparable sales from old stores went up by 5.3%, with the old locations generating P4.40 billion of the total revenue. New stores, or those that have been operating for less than a year, contributed P303 million.
Wilcon expects to see better contribution with the opening of 11 new stores this year. Since January, the company has already opened two new depots and one home essential format, placing it on track to open seven more depots and one-mall based store which are already in various stages of construction.
“Barring any unexpected external factors, we should be able to open the 11 stores planned for this year, which together with the stores opened in 2017, should help in the recovery of store expansion-related front-loaded costs for us to realize our projected mid-teens net income growth,” Mr. Belo said.
Shares in Wilcon went up 26 centavos or 2.25% to close at P11.82 each at the stock exchange on Tuesday. — Arra B. Francia
Global-Estate Resorts net income jumps 25% in Q1
GLOBAL-ESTATE Resorts, Inc. (GERI) expanded its attributable profit by 25% in the first quarter of 2018, supported by the opening of its first full-scale mall in Laguna in 2017.
In a statement issued Tuesday, the leisure business of tycoon Andrew L. Tan said net income attributable to equity holders of the parent reached P407 million in the January to March period. Revenues, meanwhile, were flat at P1.66 billion.
GERI cited the opening of its 58,000-square meter Southwoods Mall in Biñan, Laguna for boosting rental income for the period, which tripled to P87 million from P27 million in the same period in 2017.
“We remain focused to our goal of reaching P650 million in recurring revenues by 2020. In the next two years, we are opening more commercial and retail spaces across our tourism and leisure townships across the country in order to achieve this goal,” GERI President Monica T. Salomon said in a statement.
GERI has a total of seven tourism and leisure estates in the country, the latest of which is the Hamptons Caliraya, a 300-hectare integrated lifestyle community in Lumban-Cavinti, Laguna. The listed firm has already launched the residential component of the estate, The Hamptons Village, which offers lots that have their own private marina and access to Lake Caliraya.
Shares in GERI rose by 4.72% or six centavos to close at P1.33 each at the Philippine Stock Exchange on Tuesday. — Arra B. Francia
Atlas Mining swings to profit on higher metal prices
ATLAS CONSOLIDATED Mining and Development Corp. swung to a profit in the first quarter of the year, driven by higher metal prices and increased shipment volumes.
In a statement, Atlas Mining said its consolidated income surged 325% to P475 million during the January-March period, from a P211-million net loss during the same period last year.
“Excluding provisions for gains on copper price hedges, its underlying earnings increased to P149 million on the strengthen of higher production, shipments and metal prices,” the company said.
Gross revenues went up 46% to P4.1 billion from P2.8 billion.
Atlas Mining noted the commodities market remained strong in the first quarter, as metal prices rose year on year. The average realized price of copper went up by 19% to $3.14 per pound from $2.63 per pound from a comparable period last year.
The average realized gold price likewise climbed by 9% to $1,330 per ounce, from $1,225 per ounce a year ago.
Copper metal produced increased 16% to 20.32 million pounds, while shipment volume rose 16% to 22.60 million pounds of copper metal.
Atlas Mining also saw improved gold production, which jumped 59% to 6,537 ounces. — A.G.A. Mogato