Philippine Seven Corporation, the operator of convenience store chain 7-Eleven, reported a 27.5% increase in sales for the first 6 months of the year, while its net income grew by 32.5%.
Election spending boosts performance
In a disclosure to the stock exchange, PSC revealed that retail sales of all stores went up by 27.2% to PHP15.5bn (US$328.9m), from PHP12.2bn (US$258.8m) a year ago, boosted by election-related spending and aggressive store expansion.
Philippine Seven opened the most number of new stores in its history last year. As of end June 2016, its store count reached 1,740, up 24% from 1,405 from the same period a year ago.
Store expansion continues
Philippine Seven Corporation has allocated a capital spending PHP 3.5bn (US$74.3) for 2016, substantially higher than last year. Bulk of the amount is allocated for new store opening, store renovation and equipment acquisition.
It aims to accelerate the rate of new store openings over the medium-term to take advantage of improving economic conditions and to protect its market share in light of increased competition.
The company “believes that the convenience store sector will remain to be crowded over the next five years. It intends to capitalize on its first-mover advantage and economies of scale to remain the market leader.”
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(Source: IGD Retail Analysis)