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Home improvement retailer Wilcon Depot made P533.21 million in net profit in the third quarter, just 2.9 percent below the bottom line in the same quarter last year before the COVID-19 pandemic, as the New store openings boosted sales this year.
Wilcon’s third-quarter net profit accounted for 60 percent of its January-September bottom line of P886 million, which fell 42.6 percent year-on-year due to the temporary closure of most of its stores from March 17 to March 15. May when Metro Manila and other key regions were subjected to strict lockdown protocols.
Net sales increased 7.9 percent year-on-year to P6.75 billion in the third quarter, driven by new store sales, as comparable sales growth held steady at 0.4 percent.
Operating income for the quarter under review increased 8.1 percent year-on-year to reach P755 million, but lower interest income coupled with higher income tax dragged net income 2.9 percent from last year’s level. .
“We are very encouraged by the increase in our sales in the third quarter and we are hopeful that the growth trajectory will continue in the fourth (quarter). In fact, we opened another branch in Laguna this September, bringing our total number of stores to 61. However, it is particularly challenging that we have a foundation as high as we did extremely well in the fourth quarter of 2019, ”Wilcon CEO Lorraine Belo-Cincochan said in a press release Friday.
Following the reopening of Wilcon branches in Luzon on May 16, it reported an immediate increase in foot traffic and sales as quarantined consumers scrambled to upgrade their homes to cope with work-from-home arrangements ( FMH).
The increase continued through July with comparable sales growth of 3.1 percent, but this was halted in August when Metro Manila and some nearby provinces were again subjected to strict quarantine measures for two weeks. All branches remained open but with shorter opening hours, so pedestrian traffic decreased again.
As quarantine measures were gradually lifted, Wilcon’s sales rebounded in September, resulting in a 2.9 percent growth in comparable sales. For the quarter, same-store sales of the flagship warehouse format grew 1.5 percent, while the household essentials segment decreased 11.1 percent and project sales also fell 54.3 percent. hundred. Warehouse format accounted for 97.3 percent of net sales in the third quarter, while household essentials and projects accounted for 2.1 percent and 0.6 percent, respectively.
Operating expenses, including reclassified rental-related expenses to interest expense, also grew 10.1 percent year-over-year during the third quarter to P1.62 billion, and 7.6 percent year-over-year to a total of P4.43 billion. for the nine-month period. The increase was primarily due to expansion-related expenses, partially offset by lower expenses due to the suspension of operations of most stores for two months in the first half.
Wilcon’s management believes that the market will continue to improve and the expansion plan outside its jurisdiction, Metro Manila, is still heading in the right direction. INQ
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