GOKONGWEI-led retailer Robinsons Retail Holdings, Inc. (RRHI) posted a 41.4% decline in its nine-month attributable net income due to various reasons including higher equitized losses from its minority start-up investments.
In a regulatory filing on Thursday, RRHI said its nine-month attributable net income fell to P2.58 billion from P4.41 billion a year ago.
“The decline in net income [attributable] to parent was weighed by equitized losses from minority start-up investments which continue to ramp up, the derecognition of Robinsons Bank’s net income under equitized earnings following the ongoing merger with the Bank of the Philippine Islands (BPI), interest expense from the acquisition financing of the BPI shares that were purchased earlier this year, and the absence of cash dividends from BPI in the third quarter of 2023,” RRHI said.
Despite the lower attributable net income, RRHI said its net sales during the January-to-September period climbed 8.7% to P138.20 billion from P127.09 billion, led by its supermarket and drugstore segments.
The listed firm’s core net earnings also climbed 4% to P3.79 billion from P3.64 billion.
“The company was able to generate growth in net sales and core net earnings despite the impact of inflation on consumption and a challenging base last year which benefitted from economic reopening and election-related spending,” RRHI said.
RRHI added that its net sales growth was supported by a 5% growth in blended same-store sales as well as store expansion initiatives.
“The core staples businesses — supermarkets and drugstores in particular were the main revenue growth drivers in [the] first nine months of 2023. These two segments accounted for almost 75% of RRHI’s revenues for the period,” the company said.
It added that “a bright spot” in its portfolio was the department store segment, which it said managed to deliver double-digit topline growth as of the third quarter “due to back-to-school and continued out-of-home activities.”
RRHI’s consolidated gross profit during the period climbed 9.4% to P32.9 billion due to improvements in its category mix and higher penetration of private label brands. Operating income rose 3.7% to P6.14 billion.
“Our defensible business model has enabled us to continue growing and remain relevant among Filipino consumers. This is notwithstanding near-term macroeconomic challenges, particularly the impact of inflation on consumer sentiment,” RRHI President and Chief Executive Officer Robina Gokongwei-Pe said.
“These headwinds are temporary, in our view, and we thus remain positive on the long-term potential of the domestic retail industry given the Philippines’ attractive demographics. We will continue to invest with a long-term view and in a sustainable manner — core strategies that we firmly believe will translate to greater stakeholder value,” she added.
As of end-September, RRHI has 2,368 stores consisting of 1,033 drugstores, 416 convenience stores, 341 supermarkets, 298 specialty stores, 230 DIY stores, and 50 department stores. The listed retailer also has over 2,000 franchised stores of The Generics Pharmacy drugstore.
On Thursday, shares of RRHI at the local bourse rose 20 centavos or 0.47% or P42.40 apiece. — Revin Mikhael D. Ochave