SSI gains P170.6M in first three months of 2019
MANILA, Philippines — The country’s leading specialty retailer SSI Group Inc. grew net profit in the first quarter by 28.4 percent year-on-year to P170.6 million as it sold more goods at improved margins even with a small store network footprint.
Excluding non-recurring items – mostly pertaining to write-offs from store closures and net operating loss carry over (NOLCO) – SSI’s first quarter core net profit rose by 35.5 percent year-on-year to P184.1 million.
“The group’s first quarter results reflect healthy same store sales growth and the increased flexibility afforded by our lower operating expense (opex) base and inventory levels,” SSI Group president Anthony Huang said.
“Our lower opex base and inventory levels allow us to be more responsive to macro- economic change, to shifts in consumer behavior and to opportunities to acquire exciting new brands,” he added.
Net sales for the first three months increased by 7.2 percent year-on-year to P4.9 billion, attributed to healthy consumer demand and solid same store sales growth of 8.6 percent.
The group achieved higher net sales despite a 5-percent decline in total floor area. The group has rationalized its store network to focus on developed or mature brands in developed locations.
As of end-March, SSI’s total floor area covered around 119,754 square meters over 594 stores nationwide. During the first quarter, the group opened seven stores covering 833 square meters and closed nine stores covering 1,384 square meters.
The group saw a 231-basis point increase in first quarter gross profit margin to 42.4 percent compared to the fourth quarter of 2018. This also improved from the 42.1 percent margin posted during the same quarter last year.
The SSI Group maintains a portfolio of 90 brands, which includes many of the world’s most recognizable brands, and a store network located in prime retail locations nationwide, including Rustan’s department stores that cater to the more affluent consumers. Apart from its extensive portfolio of fashion and personal care brands, the group also operates TWG Tea and SaladStop!, and recently opened the first Shake Shack restaurant in the Philippines in BGC.