In the first quarter, China Resources Enterprise's (CRE) retail sales grew 7.3% to HKD 25.9bn (USD 3.3bn) and net profit declined 6.3% to HKD 252m (USD 32.5m).
New store openings driving growth
A leading grocery operator in the market, CRE's performance in the first quarter was robust, but represents a slow-down compared to its very strong start to the year in 2012. Retail sales growth of 7.3% was supported by new store openings, whilst same store sales grew 2.9% versus 6.4% in the same period last year.
Stronger performance at company level driven by beer and beverages
CRE's business portfolio comprises of retail, food, and drink divisions. Total sales grew by 8.4% to HKD 36.1bn (USD 4.7bn) in the first quarter, whilst profit declined 8.6% to HKD 512m (USD 66m). Retail continues to make the greatest contribution to sales, though good weather contributed to a strong performance from the beverage division, boosting the company's overall performance.
Expansion strategy for 2013
CRE operates a multi-format portfolio in China and its domestic market Hong Kong, including its best known fascia Vanguard. The company is expanding its geographic coverage in China in order to establish a national presence, whilst boosting concentration of stores within each region to achieve a leading local position. Focus in 2013 will be on moving into third and fourth tier cities. CRE's broad portfolio of formats spans from hypermarket to convenience, premium to health and beauty and provides flexibility to meet the wide range of shopper missions within the market.