Wilcon expects earnings recovery in 2nd semester
MANILA, Philippines – Home improvement retailer Wilcon Depot Inc. expects to bounce back in the second semester after posting a weak first-quarter performance, citing stronger sales momentum.
The Belo family-led company disclosed to the stock exchange on Monday that its net income in the first three months of the year had fallen by 27.5 percent to P536 million due to higher costs and lower sales in January and February.
“Despite the drop in net earnings … we are expecting a turnaround especially in the second half given the encouraging average daily sales right before and right after the long Easter holidays in April,” Wilcon president Lorraine Belo-Cincochan said in their disclosure.
READ: Higher costs, low sales in Jan to Feb drag Wilcon Q1 earnings
“Should this sales trend continue and especially if it improves further, we expect to reverse the decline in net earnings in this quarter later in the year,” Cincochan added.
Net sales in the first three months of the year inched up by 1.2 percent to P8.41 billion. Although growth was slower, Wilcon credited sales from its two new stores as the main drivers.
Wilcon opened one depot in North Luzon and a smaller format Do-It-Wilcon (DIW) in Metro Manila during the period, bringing its store network to 102 branches across the country.
This year, Wilcon plans to open eight new stores, half of which began construction in 2024. Cincochan previously told reporters that most of the new stores would be a mix of small and medium formats.
New stores boost sales
Broken down, depots accounted for 96.5 percent of the group’s total sales in the first quarter at P8.12 billion, up by 1.8 percent. DIW stores, on the other hand, contributed 3.1 percent at P258 million, representing an 11.1-percent increase.
According to Cincochan, their younger stores, or those that have been operating for less than a year, posted gains in the first three months, following “quarterly negative results all of last year.”
“We are hoping that this indicates a growing sales trend that will be sustained from here on,” she added.
Meanwhile, gross profit declined by 1.7 percent to P3.26 billion due to a decline in project sales, Wilcon said.
Operating costs were up by 7.8 percent to P2.66 billion on the back of depreciation of new store buildings, lease-related interest expenses and salaries.
