Parkson Retail Asia fiscal 3Q net loss narrows, but Indonesia earthquakes hit sales

Parkson Retail Asia department store in Ho Chi Minh City, VietnamParkson Retail Asia department store in Ho Chi Minh City, Vietnam

Parkson Retail Asia’s fiscal third quarter net loss narrowed to S$5.39 million, from a S$7.82 million net loss in the year-ago period, amid lower expenses.

Revenue for the quarter ended 31 March fell 3.2 percent on-year to S$101.14 million, the department store operator said in a filing to SGX.

Finance income increased 58.8 percent on-year to S$508,000, Parkson Retail Asia said in the filing.

Total expenses declined 6.0 percent on-year in the quarter to S$106.79 million, the filing said, with rental expenses falling 9.8 percent on-year to S$26.59 million amid store closures.

Numerous earthquakes in Lombok and Bali during the quarter dented tourist confidence for traveling in Indonesia, resulting in fiscal third-quarter same-store sales contracting 4.1 percent on-year there, Parkson Retail Asia said.

Vietnam same-store sales contracted 20.5 percent on-year in the quarter as the country’s retail scene became increasingly competitive, the company said.

In Malaysia, same-store sales growth was 4.8 percent on-year in the quarter, mainly on better efficiency after the closure of underperforming stores, the filing said.

As of end-March, Parkson Retail Asia had a department store network of 64 stores, with 44 in Malaysia, five in Vietnam and 15 in Indonesia. That was after adding three new stores and exiting five underperforming stores, it said.

Parkson Retail Asia issued a cautious outlook.

“The group’s operating environment for the final quarter of fiscal 2019 is expected to remain challenging amid severe competition. Nevertheless, it is expected to benefit from the festive retail buying arising from the Hari Raya/Lebaran celebrations,” the department store operator said.

 

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