The first half earnings of home improvement retailer Wilcon Depot Inc. slipped by 16.9 percent to P1.51 billion due to softer sales and losses from a fire in one of its branches in Bulacan province.
The Belo family-led firm on Wednesday said sales during the period were flat at P17.2 billion as contributions from depot format stores—Wilcon’s largest sales contributor—recorded a slight 1-percent dip to P16.5 billion.
Operating income likewise declined by 17.2 percent to P2 billion, while operating expenses inched up by 8.6 percent to P5.1 billion.
READ: Weak home upgrade trend trimmed Wilcon results in 2023
According to Wilcon, losses from the fire in its Baliuag store in April totaled P12 million.
In the second quarter alone, the company’s net income slipped by a tenth to P770 million versus the same quarter last year, while sales recorded a modest 2.9-percent growth to P8.87 billion.
“We are looking forward to a better second half as we continue to push for higher sales while realigning resources deployed with the current market demand,” Wilcon president and CEO Lorraine Belo-Cincochan said in a statement.
On the upside, Belo-Cincochan said they were on track to reach their 100-store target by the end of the year.
Wilcon opened five new stores in the January to June period, expanding the company’s network to 95 stores.
Earlier, Wilcon said it planned to spend up to P2.2 billion this year to support expansion plans, particularly its smaller format stores that thrived during the pandemic lockdowns.
Mary Jean Alger, Wilcon vice president for investor relations, said the bulk of the capital spending would go to construction work for at least 10 new stores.
While there has been a global “softness in demand” in the home improvement sector, Wilcon said they expected to rebound in the fourth quarter once lower interest rates spur consumer spending.
The sector saw a boom in 2021 to 2022, when homeowners were stuck at home and pursued long overdue renovations.
Back then, Wilcon saw record profits, which surged by 50.2 percent to P3.85 billion.