SSI Group Inc., the country’s largest specialty store retailer, said net income in 2017 rose 19 percent to P275 million after closing down stores to rationalize operations.
SSS said in a filing with the Philippine Stock Exchange net sales last year were flat at ₱18.5 billion, which it considered better than expected given the highly competitive environment, weakening peso and the 6.7-percent decline in the group’s selling area
“This also reflects the impact of the Group’s store rationalization program, which seeks to improve the overall sales quality and operating efficiency of the group’s store network. The rationalization program also seeks to strengthen the group’s dominant position in high productivity, central locations,” SSI Grop said.
SSI Group’s network totaled 638 at the end of 2017, covering 129,486 square meters from 708 stores in 2016 over an area of 138,852 sq. m.
The specialty store retailer incurred other charges of ₱711.5 million due to the impairment losses recognized on the group’s investments in the FamilyMart and Wellworth, as well as an increase in write-offs related to the group’s store rationalization program to ₱280.5 million.
SSI Group, however, generated a positive operating cash flow of P1.9 billion in 2017 as a result of strong cashflow generation during the fourth quarter of the year.
“We saw healthy demand from our customers during the 4th quarter of the year, a trend that continued into the 1st quarter of 2018. Resilient consumer demand combined with the group’s strengthened store network and increased operating efficiencies were the drivers of the group’s turn around in 2017. We expect that these same factors will continue to drive our growth in 2018,” SSI Group president Anthony Huang said.
The SSI Group maintains a portfolio of 107 brands, which include many of the world’s most recognizable brands, and a store network located on prime retail locations nationwide.