By Arra B. Francia, Reporter
ROBINSONS Retail Holdings, Inc. (RRHI) will be spending up to P3.5 billion in capital expenditures this year to support its development of 100 to 120 new stores.
“We project to spend a total of P3 billion to P3.5 billion in capex for our planned organic store expansion this 2018,” RRHI President and Chief Operating Officer Robina Y. Gokongwei-Pe said during the company’s annual shareholders’ meeting in Pasig City yesterday.
The planned 2018 spending is 12.7% higher than the P3.105 billion it spent the year before. For the first quarter alone, Ms. Gokongwei-Pe said they have already spent P683 million from the capex.
The Gokongwei-led retail company will be opening 13 supermarkets, three department stores, 10 to 15 Do-it-yourself stores, 20 to 30 convenience stores, 25 to 30 South Star Drug stores, and 30 to 35 specialty stores.
On top of this, RRHI will also open 100 new franchised stores from The Generics Pharmacy.
Ms. Gokongwei-Pe said the 2018 capex will not include its acquisition of Rustans Supercenters, Inc. (RSCI). The company last March said it planned to buy out Mulgrave Corp. B.V. (MCBV)’s 100% share in RSCI. MCBV is a wholly owned member of Dairy Farm International Holdings, Ltd. Group of Companies, with which RRHI has partnered with for a food retail business.
The acquisition will be funded through the issuance of 191,489,260 new common shares of RRHI in exchange for the purchase of 100% of the capital stock of RSCI from MCBV, valued at around P18 billion.
Shareholders of the company approved the issuance of RRHI’s shares during the annual meeting. Meanwhile, the transaction is still pending approval from the Philippine Competition Commission.
This year, RRHI will be adding pet care retail to its portfolio with the opening of the Pet Lovers Center brand inside Robinsons Galleria in the third quarter of 2018. The pet care retail store was franchised from Singapore.
“We will open first this store. We want to make sure that the first store runs smoothly before opening a second one,” Ms. Gokongwei-Pe told reporters on the sidelines of the meeting.
To further support its expansion, RRHI will be moving to a 3.3-million hectare distribution center worth P150-200 million in Sucat, Parañaque in June. This is more than twice the size of RRHI’s current facility covering 1.6 million hectares in Pasig. Ms. Gokongwei-Pe said the new facility can accommodate up to 500 stores.
RRHI grew its first quarter net income by a fifth to P1.2 billion, following a 12.6% increase in consolidated net sales to P29 billion during the period.
The company targets a same store sales growth of 3-5% this year, with blended gross margin expected to expand by another 10 to 20 basis points.
Shares in RRHI went up 2.81% or P2.45 to close at P89.60 each at the Philippine Stock Exchange on Monday.
