GROCERY operator Puregold Price Club, Inc.’s net income grew by 14.6% to P2.02 billion in the January-to-March period from P1.76 billion year on year despite posting a decline in net sales.

“This was principally driven by the continuous organic expansion of the group’s grocery retail outlets, strategic cost management, and sustained consumer demand,” Puregold said in a regulatory filing on Tuesday.

First-quarter net sales amounted to P37.73 billion, around 7.9% lower than last year’s P40.95 billion due to a drop in customer foot traffic.

The company said during its annual stockholders’ meeting on Tuesday that “small format and mini-mart stores” remain a key focus area as it continues to adjust its products and services with the needs of its consumers.

“We have adapted what we call the caravan [where] we bring many items to the locality that may be far from our stores so that the consumers need not go to our stores due to the difficulty in mobility,” Leonardo B. Dayao, director of Puregold, said.

The grocery operator said it also aims to continue with its expansion plans this year.

“We will pick up the pace of it and in the plans for this year would be like 30 [new stores], but if the restrictions would be opened up a little bit, we can stretch that as much as 35 to 40,” Levi B. Labra, board consultant of Puregold, said.

The company plans to allocate around P4.1 billion to P4.7 billion for its capital expenditures (capex) this year, which is a bump from its 2020 capex budget of P3.4 billion.

Nearly half of this year’s budget, or around P1.7 billion to P2.3 billion, will be set aside for the new Puregold stores.

Meanwhile, P1.6 billion will be used to fund two new S&R stores, around P200 million for 10 S&R QSRs (quick service restaurants), and P600 million will be set aside for the company’s maintenance capex.

Puregold ended 2020 with 469 stores under its belt nationwide, broken down as 403 Puregold stores, 20 S&R membership shopping grocers, and 46 S&R QSRs.

Shares of Puregold at the stock exchange closed unchanged at P33.90 on Tuesday. — Keren Concepcion G. Valmonte