Puregold eyes P5B debt offer

MANILA, Philippines—Retailer Puregold Price Club Inc. is planning to debut on the local debt market through the sale of as much as P5 billion in debt paper to a select group of institutional investors.

In a disclosure to the Philippine Stock Exchange on Monday, Puregold said it would hold a briefing for potential lenders on the proposed fixed-rate corporate notes facility this Thursday.

Puregold has appointed First Metro Investment Corp. as lead underwriter and arranger of the deal. The company plans to use proceeds from the issuance to finance Puregold’s new store rollouts.

Unlike corporate bonds, which involves a tedious registration process at the Securities and Exchange Commission, corporate notes are a faster fund-raising option for big companies who may sell the debt paper to no more than 19 institutional investors.

Based on a revised 2012 financial results guidance released by the company, Puregold is expected to post a net profit of P2.63 billion this year—71 percent higher year on year.

Consolidated net sales are projected to grow by 50 percent from the P39 billion level in 2011, while net margin this year is seen at 4.5 percent. As a result, consolidated revenues may hit P58.5 billion this year, while net profit margin is projected at 4.5 percent, implying a net profit level of P2.63 billion for 2012.

In the first semester, Puregold’s net profit went up by 32 percent year on year to P1.03 billion as new acquisitions and store openings helped boost sales. Last June, the group acquired the six-store S&R membership chain and 19 Parco supermarkets, contributing 15.1 percent to the total increase in the group’s net sales.

INQUIRER FILE PHOTO