Dairy Farm International Hldgs Ltd Nine Months 2017 Results of PT Hero (8362U)
27 October 2017 - 8:46PM
UK Regulatory
TIDMDFI TIDMJAR TIDMJDS
RNS Number : 8362U
Dairy Farm International Hldgs Ltd
27 October 2017
To: Business Editor 27th October
2017
For immediate
release
PT HERO SUPERMARKET TBK
NINE MONTHS 2017 RESULTS
The following announcement was issued today by the Company's
84.5%-owned subsidiary, PT Hero Supermarket Tbk.
For further information, please contact:
Dairy Farm Management Services
Limited
Neil Galloway (852) 2299 1896
Brunswick Group Limited
Kevin Hartnett (852) 3512 5072
South Tangerang, 27(th) October 2017
PT HERO SUPERMARKET TBK
NINE MONTHS 2017 RESULTS
Highlights
-- Net revenue down 5%
-- Gross profit up 1%
-- Net income of Rp 70 billion
-- Declining sales in Food business
-- Improved performances in Guardian and IKEA
"The current trading conditions are expected to persist for the
remainder of the year. With the continuing challenges facing the
Food business, we are undertaking a strategic review to underpin
the long-term profitability for the Company."
Stephane Deutsch
President Director
Results
(Unaudited)
Nine Months
2017 2016 Change
Rp billion Rp billion %
------------------- ----------------------- -------------- ------------- -------
Net Revenue* 9,961 10,470 -5
Gross Profit* 2,638 2,602 +1
Operating Profit* 77 25 100+
Profit/(Loss)
for the period - Continuing* 70 35 +99
- Discontinued** - 10 n.m.
- Total 70 45 +57
------------------------------------------- -------------- ------------- -------
Rp Rp %
------------------- ----------------------- -------------- ------------- -------
Profit/(Loss)
per share - Continuing* 17 9 +89
- Discontinued** - 2 n.m.
- Total 17 11 +55
------------------------------------------- -------------- ------------- -------
* Excluding Starmart operations
** Starmart operations
n.m. = not meaningful
PRESIDENT DIRECTOR'S STATEMENT
Overview
The Company's performance for the first nine months of 2017 was
negatively impacted by declining sales in the Food business, which
were worse in the third quarter following the Eid Mubarak festive
period. In contrast to the Food business, both the Guardian and
IKEA businesses are trading well and reported strong sales and
profit growth.
Financial Performance
Total sales in the first nine months of 2017 were 5% lower than
the prior year at Rp 9,961 billion as a result of lower Food sales.
Operating profits improved, however, over the prior year as a
result of higher profitability in Guardian and IKEA. The Company
recorded net income of Rp 70 billion for the first nine months of
2017, up from Rp 45 billion in the same period in 2016.
Sales in the Food business declined by 8% to Rp 8,342 billion
due to negative like-for-like sales and store closures, with weaker
performances seen in both supermarkets and hypermarkets. Sales in
the Guardian and IKEA businesses grew 13% to Rp 1,619 billion,
compared with Rp 1,435 billion in the prior year, principally
driven by strong like-for-like performances.
As at 30(th) September 2017, the Company had a net cash position
of Rp 60 billion.
Business Activities
In the Food business, competition intensified as mini market
operators continue to invest heavily in their network development.
Several initiatives to improve the Food business performance are
underway. These include a review of promotions and pricing strategy
between formats, addressing poor supplier service levels, and
improving supply chain distribution to improve stock availability
in the stores. A broader strategic review is being undertaken to
validate future development plans for the Food business.
In Giant, a second Giant Ekstra store has been opened in Malang.
In Hero, the upscale supermarket format, plans are underway to
revitalize the store base following the encouraging results from
the remodeled pilot store opened earlier in the year.
Guardian has continued to benefit from the rationalization of
underperforming stores in 2016. Greater focus on the beauty segment
has resonated with customers, with this category driving much of
the growth year to date. Work is continuing on refining further the
range as the business becomes increasingly responsive to local
customer needs.
At IKEA, the sales performance was significantly ahead of the
prior year. The new IKEA catalogue, with a focus on the living
room, was launched in September and has been well received by
customers. IKEA's online activities continue to grow with a second
IKEA E-commerce Distribution Point opened in Surabaya to support
future online sales growth.
At 30(th) September 2017, the Company operated 450 stores,
little changed from the prior year end, comprising 57 Giant Ekstra,
108 Giant Ekspres, 32 Hero Supermarket, 2 Giant Mart, and 250
Guardian stores, as well as one IKEA store.
Prospects
The current trading conditions are expected to persist for the
remainder of the year. With the continuing challenges facing the
Food business, we are undertaking a strategic review to underpin
the long-term profitability for the Company.
Stephane Deutsch
President Director
27(th) October 2017
- end -
For further information contact:
Stephane Deutsch, President Director
PT Hero Supermarket Tbk
Tel: +62-21-8378 8388, Fax: +62-21-831 7764
This information is provided by RNS
The company news service from the London Stock Exchange
END
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