Food: improvement in large format
In its food division, sales in the hypermarket and supermarket operations showed some improvement for the period despite modest like-for-like sales growth being offset by some store closures. Slightly higher margins helped to produce an increased profit compared with the same period last year.
In convenience, higher sales were seen in Hong Kong, Singapore and mainland China, with like-for-like sales growth stronger than in the first half of the year. Profitability of the convenience store operations also improved.
Health and Beauty: Hong Kong and Malaysia hold back profitability
In the Health and Beauty division, sales were higher than the prior year and overall like-for-like sales growth improved compared with the first half of the year. Profitability remained marginally below 2016, however, principally due to margin erosion in Hong Kong and Malaysia.
Key markets: further investment in China
In China, Dairy Farm completed its further US$190m investment in Yonghui to maintain its 19.99% shareholding following a 10% share placement by Yonghui to internet retailer JD.com in August.
In Indonesia, for Q3, sales in the food business were negatively impacted by store closures, the timing of Eid Mubarak trading, and continuing weakness in consumer confidence. But like-for-like sales were positive for both Health and Beauty and Home Furnishings. Profitability in each of Food and non-Food improved.
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Shirley Zhu, Programme Director, IGD Singapore
Based in Singapore, Shirley heads up all of IGD's research on Southeast Asia. Contact Shirley at [email protected] for further insight on the region.