ROBINSONS Retail Holdings, Inc. (RRHI) is looking to rationalize the store network of Rustan Supercenters, Inc. (RSCI)
“Like what the whole RRHI does, we’ll expand (in) the locations we know would be profitable. And then we’ll close those that are hopeless,” RRHI President and Chief Executive Officer Robina Y. Gokongwei-Pe told reporters after the company’s stockholders’ meeting in Ortigas on Thursday.
“You have to look at efficiencies, and like all companies, you have to cut off the fat,” she said.
RRHI completed the acquisition of RSCI in December last year. The deal placed RSCI’s total network of 80 stores, including Marketplace by Rustan’s, Rustan’s Supermarket, Shopwise Hypermarket, Shopwise Express, and Wellcome, under RRHI’s control.
Ms. Gokongwei-Pe noted the company bought RSCI because it “saw the potential.”
“Their top-line sales was P24 billion when we got it. With P24 billion you’ll be able to get scale, take advantage of the scale and the efficiencies,” she said.
RRHI’s attributable net income fell 32% to P827 million in the January to March period. Excluding RSCI, the company would have booked an eight percent uptick in core net earnings to P1 billion.
The company said it is targeting to open 100 to 125 new stores in 2019, composed of 15 to 17 supermarkets, 18 to 20 do-it-yourself stores, 30 to 40 convenience stores, 15 to 30 drugstores and 20 to 25 specialty stores. This does not include another 100 new franchise stores of The Generics Pharmacy (TGP).
“We project to spend a total P3.5 billion to P5 billion for our planned organic store expansion this 2019,” Ms. Gokongwei-Pe said. She noted the allocation of the capital expenditures will likely remain the same: 52% for supermarkets, 16% for specialty stores, 14% for department stores, 10% for do-it-yourself stores, 5% for convenience stores and 3% for drugstores. — Denise A. Valdez