WILCON Depot Inc. on Tuesday reported a 3.5-percent increase in first-half net income to P1.20 billion from P1.16 billion a year earlier, with stronger store traffic said to have helped drive double-digit sales growth.
In a disclosure, the company said net sales rose 10.9 percent year on year to P18.98 billion in the first six months, while comparable sales grew 6.6 percent across the company’s store network.
Sales improvement was more pronounced in the second quarter, with comparable sales growth accelerating to 8.4 percent.
As a result, second-quarter net income increased 2.4 percent year on year to P641 million, while net sales climbed 12.7 percent to P9.81 billion.
“Our second-quarter results showed solid demand, with total sales up 12.7 percent and same-store sales rising 8.4 percent. Every region delivered positive same-store sales growth,” Wilcon President and CEO Lorraine Belo-Cincochan said.
For the second quarter, operating expenses climbed 12 percent to P2.94 billion, with the company citing bulk lease renewals, annual salary adjustments, new branch openings and higher utility rates as among the factors behind the increase.
Depot sales accounted for 96.3 percent of total net sales in the second quarter, rising 12.9 percent to P9.45 billion. Same-store sales for the format increased 8.5 percent.
Meanwhile, sales from Do It Wilcon (DIW) stores rose 14.2 percent to P322 million, with comparable sales growing 10.2 percent during the quarter.
For the first half, Wilcon said gross profit increased 7 percent to P7.08 billion, while gross profit margin narrowed to 37.3 percent from 38.5 percent a year earlier.
Net sales rose 10.9 percent to P18.98 billion, with all regions — including project sales — recording positive comparable growth rates during the first six months, the home improvement and construction supply retailer said.
Operating expenses, including lease-related interest expense, rose 8 percent to P5.71 billion, mainly due to higher depreciation and amortization, manpower expenses, utilities and trucking.
Wilcon opened five new stores during the first half and plans to open three more before the end of the year.
Capital expenditures reached P1.2 billion as of June, with the bulk spent on the construction of new stores and warehouses.
Belo-Cincochan said the company would focus on improving its product mix and managing costs in the second half.
“We are encouraged by the gains in customer count and sales volume. These show we are reaching more customers and give us room to improve the product mix and manage costs in the second half,” she said.
Wilcon said stores operating for less than a year still generated positive net income during the first half despite contributing to the increase in operating expenses.
The company’s shares on Tuesday added P0.01, or 0.17 percent, to close at P5.96 each.
