Robinsons has reported a strong H1 performance: a net income increase of 25.9% to PHP1,953m ($US41.9m) and 14.3% growth in gross profit to PHP9,016m (US$193m). Performance was driven by ambitious store opening plans: 219 stores have opened, boosting store numbers to 1,399 nationwide.
New stores driving growth
Sales growth across the business was mainly driven by new stores as well as higher contributions from its franchised convenience model.
Supermarkets: net sales within supermarkets, the largest segment of the group, grew by 9.3% to PHP19,866m (US$426m). This robust sales growth was driven by 15 new stores over the year. Gross margin also showed respectable gains of 12% to PHP3,740m, resulting from supplier discounts and the benefits of economies of scale.
Convenience stores: system-wide sales from Ministop surged by 15.9% to PHP3,837m (US$82.3m). This growth was attributed to the additional 80 stores opened this year and same store sales growth of 5%. Other income was generated from royalties of the retailer's franchise model and increased by 26.3% to PHP571m (US$12.2m). Gross profit also grew by 25% and reached PHP968m (US$20.8m).
Drugstores: net sales reached PHP3,833m (US$82.3m) with 11.4% increase driven by 62 new stores this year including Chavez Pharmacy, a seven store retail chain acquired in June 2014. Gross margins have also expanded to PHP619m (US$13.3m), a 10% increase.
Department store and DIY sales also improved, by 9% and 21% respectively, as a result of new stores and strong performance in existing stores.
Robinsons plans to spend PHP6bn on expansion next year to build between 250 and 300 new stores. This is likely to be the largest expansion in the history of the company and is expected to top the 263 new stores opened in 2014. Ministop, the retailer's convenience banner, will have the majority of new openings. According to Gokongwei-Pe, the retail president of Robinsons, "It has become quite competitive so we're focusing on our strength which is ready-to-eat...there's still room to grow for our convenience store business."