Leading local convenience store operator Philippine Seven Corp. grew its net profit in the first six months by 32.5 percent year-on-year to P472.3 million, as retail sales were lifted by election spending and an expansion in its store network.
PSC plans to raise its capital expenditure budget this year to P3.5 billion from P3 billion last year to further support its store expansion strategy amid stiffer competition.
The local licensee of 7-Eleven convenience stores ended June with 1,740 stores, rising by 23.8 percent year-on-year.
Luzon remains the group’s bailiwick but it has been growing its footprint in the Visayas and Mindanao as well.
Of the total network, most branches are still in Luzon at 1,474 while 203 stores are in the Visayas and 63 are in Mindanao.
Franchising plays a key role in the growth of the company, with franchisees accounting for 57 percent of total stores with the balance owned by the company.
PSC’s six-month retail sales reached P15.5 billion, up by 27.2 percent compared with the level set last year.
Excluding newly opened stores, same-store sales went up by mid-single digit during the six-month period.
For the second quarter alone, PSC grew its net profit by 19 percent year-on-year to P290 million. This was driven by a 22-percent year-on-year growth in retail sales to P8.12 billion.
“The company is set to attain another milestone this year in terms of store count and profitability,” PSC said in a statement.
The bulk of the P3.5-billion capital spending for the year is allocated to new store openings, store renovation and equipment acquisition.
“While competition is likely to be more intense, PSC is the most capable to strengthen its position in the convenience store sector. It aims to capitalize on its first-mover advantage and intends to benefit from the capacity-building expenditures over the last three years. It believes that the market will continue to grow as it enables the organization in achieving new heights,” it said.