EARNINGS of SSI Group, Inc. increased by 8% during the second quarter, fueled by a 13% growth in same-store sales.
In a regulatory filing, the listed specialty store retailer said its second quarter net income went up to P150.4 million year-on-year as strong sales growth and rationalized expenses helped offset the effects of a weaker peso.
This brought its first half net income 3% higher to P283.3 million.
Revenues increased by 14% to P4.67 billion during the April to June period, and by 11% to P9.3 billion for the first six months of 2018.
SSI said its same-store sales growth (SSSG) stood at 13.4% and 11.6% during the second quarter and the first half, respectively.
“SSI experienced robust growth in net sales during the first half of the year driven by strong consumer demand. This is reflected in the very strong performances of the Group’s brands under the luxury, bridge, and casual categories. This is despite the fact that the Group’s total selling space decreased by 7.4%,” the company said.
As of end-June, its store network stood at 616 covering 124,333 square meters, versus 665 stores covering 133,816 sq.m. a year ago. During the April to June period, SSI Group opened four stores and closed 14 stores.
Fast fashion accounted for the bulk of SSI’s first-half sales at P3.33 billion, up 5% year-on-year. This was followed by luxury & bridge lines at P2.23 billion, surging 24%.
SSI’s portfolio had 100 brands as of end-June, including Prada, Gucci, Zara, Gap, Old Navy, Burberry, Marks & Spencer, Lacoste, Muji and Payless.
Operating expenses rose 2% to P1.74 billion during the second quarter, bringing the first-half figure to P3.45 billion, up 0.7%.
“Operating expenses as a percentage of net sales significantly improved to 37.3% as compared to 40.9% in 2017. Operating expenses increased at a slower rate than sales as the Group continued to benefit from its store rationalization program and from its focus on maximizing scale and improving cost efficiencies,” SSI said.
SSI expects sales to peak during the fourth quarter, as consumers shop more ahead of the Christmas and New Year holidays.
“We saw double digit same store sales growth during the 2nd quarter of the year as our brand portfolio and store network continued to benefit from resilient mid and high end discretionary spending and we expect that margins will continue to firm up as the year progresses,” Anthony T. Huang, SSI Group president, was quoted as saying in a separate statement.
SSI is planning to open e-commerce sites for the brands Lush, Dune and Aeropostale as well as re-launch its marketplace ssilife.com.ph within the second half. — CRAG