NEWLY listed Cebu-based mall developer Metro Retail Stores Group Inc. (MRSGI) booked P344 million in net income in the first nine months of 2015, an increase of 23.5 percent from P278 million a year ago on improved same-store sales and new store sales.
The company said net sales improved by 15 percent to P22.36 billion from P19.45 billion a year ago as same-store sales grew by 9.5 percent in the nine months, while revenue streams from new stores — two supermarkets and four hypermarkets — also contributed to the higher sales.
Pretax income in the nine months rose 24 percent to P492 million from P397 million in the same period last year.
“Our third-quarter results reflect our customers and partners’ unwavering support for MRSGI. It also underscores our confidence in the company’s capacity for expansion and widening its customer base, as the market continues to believe in the MRSGI retail experience,” Frank S. Gaisano, MRSGI chairman and chief executive officer, said in a statement.
“We are particularly encouraged by the performance of our stores in the Visayas Region,” he added.
Most of MRSGI’s outlets are in the Visayas. As of November 24, it operated 46 Metro stores nationwide composed of 24 supermarkets, 12 hypermarkets and 10 department stores.
In the first nine months, the company also said its bank debt level remained low at P950 million. It said proceeds from the initial public offering (IPO) will add around P3.4 billion to the company’s net worth by yearend, which stood at P2.7 billion as of end-September.
The company raised P3.62 billion from its maiden share sale and officially debuted on the exchange on November 24.
About 60 to 70 percent of the proceeds from the IPO are intended to ramp store expansion while the balance will be used for the enhancement of its distribution and logistics facilities.
Metro Retail said its move to join the arena of publicly-listed retailers also signals its capability to compete with other industry players in serving the value-conscious market.
“Taking MRSGI public was a strategic transformational process that enables us to accelerate growth, improve margins and operating efficiency, strengthen further our balance sheet, and consequently create value for our investors,” Gaisano said.
The company earlier said part of the budget for expansion will be used for future mergers and acquisitions mainly in the supermarket format within Metro Manila, while the bulk will be used for store openings in the Visayas Region.
Recently, MRSGI partnered with Ayala Land Inc. and Megaworld Corp. in opening unique mall and supermarket offerings, mostly in Iloilo City.
If the IPO proceeds will not be enough for its expansion plans, Metro Retail earlier said it still has P9 billion in untouched loan facilities offered by banks which they can tap in case of additional funding needs.
MRSGI’s five-year plan entails a budget of P10 billion to P15 billion, translating to capital spending of P2 billion to P3 billion for five to 10 store openings annually.