Puregold Price Club Inc., a supermarket chain owned by billionaire Lucio Co, said Friday it will spend P2.64 billion in 2016 to roll out new grocery outlets and convenience stores.
Puregold vice president for investor relations John Hao said the company would expand its retail network in Luzon, the Visayas and Mindanao.
“We have allocated P1 billion for Puregold supermarkets, P1 billion for S&R, P450 million for the roll-out of Lawson convenience store chain and P150 million for the quick serve restaurants,” Hao said in a news briefing in Makati City.
The mother unit is spending P1 billion for 25 new Puregold stores that will bring the Puregold supermarket network to about 300 stores by end-2016, he said.
The group also plans to spend P150 million to build 10 S&R New York Pizza.
Puregold vice president for operations Antonio delos Santos said once the target was met, “it will be a milestone for the company.”
The company expects to end 2015 with 274 stores nationwide with 6 stores located in Mindanao.
Delos Santos said the company was focusing on the Visayas and Mindanao to bring the benefits of low-priced, quality consumer goods “across islands, across regions.”
“We’re constantly looking for locations. Our focus is to spread across the Visayas and Mindanao since most of our stores are in Luzon. We just opened our first store in Cotabato City. This is a testament of how confident we are on the location. Next year, we are opening another [store] in Cotabato,” said delos Santos.
The company would fund the 2016 capex and possible acquisitions via cash flow, but was also open to short-term borrowing, according to Hao.
Puregold recently launched Pure Padala, an innovative way of sending remittances to OFW families in the Philippines where cash remittance is converted to benefits like groceries, tuition and payment for utilities.
Hao said despite the continued aggressive expansion, the company expected net income and revenues to grow by more than 10 percent.
Hao said the company would also continue to open at least 25 stores annually over the next five years.
Puregold had 267 stores nationwide as of end-September, including nine S&R stores and 13 S&R New York Style QSR.
Puregold reported a consolidated net income of P3.2 billion in the first nine months, up 6.5 percent from P3 billion in the same period in 2014.
Consolidated net sales increased 12.6 percent to P67.33 billion in the nine-month period, due to the strong consumer demand while income from operations grew 6.6 percent to P4.58 billion.
Puregold made two acquisitions this year, including the nine-store supermarket chain owned by Nueva Ecija-based retailer NE Inc. and an eight-store grocery chain called Budgetlane.
Share price of Puregold on Friday closed at P33.75 per share, down 0.74 percent from the previous day’s close.