7-Eleven posted increased net income for first quarter of 2009
Posted on July 13th, 2009
The fear of global recession and rising stiff competition in the retail sector notwithstanding, the Philippine franchisee of the 7-Eleven chain of convenience stores reported an increase in its net income for the first three months of the year.
The Philippine Seven Corp. (PSC) reported to the Securities and Commission (SEC), a net income of P13.27 million for the first quarter of 2009, which is more than the P5.58 million income it reported for the same period last year.
The PSC said that the positive performance for the period January to March was brought about by the aggregate growth in revenues, which is complimented by its effective cost management. The company registered an eight percent growth in revenue from merchandise sold to P1.36 billion, from P1.26 billion in the same period last year due to the continuous expansion of its store network.
As of the end of first quarter, PSC has 371 stores in Metro Manila and Luzon, which represents a 17 percent increase to its previous year’s level of 318. To date, the company has the largest convenience store network in the Philippines.
Of the network of stores, the number of franchised outlets reached 203, which accounted for 55 percent of total stores as of March this year. “The increasing store base has driven the first quarter’s profitability amidst the challenges poses by the global economic slowdown,†PSC said in a statement.
“7-Eleven is working to optimize the earnings of its stores by improving merchandise assortment and ensuring stock availability. It also aims to open new stores in strategic locations to further strengthen its foothold in the markets where it is present,†the company said.
“The company also continues to evaluate the performance of stores that dragged profitability. In the first quarter, seven new stores were opened and four under-performing stores were closed. These efforts are geared towards the goal of the organization of enhancing shareholder value,†it added
For the rest of the year, PSC plans to increase the number of its franchise-owned outlets to more than half of its total network, as it strengthens its commitment to promote franchising business as a good investment opportunity for those who want to get into the retail industry.
