WILCON Depot Inc. on Tuesday reported a modest increase in earnings for the first quarter, with steady same-store sales growth and contributions from new branches having lifted revenues despite margin pressures.
The home improvement and construction supply retailer said net income rose 4.9 percent to P563 million on the back of a 9.1-percent increase in net sales to P9.17 billion.
“We are pleased to report sustained positive same-store sales growth for the third successive quarter,” President and CEO Lorraine Belo-Cincochan said.
She noted that sales had exceeded expectations, particularly in March, despite a high base compared to the previous year.
Belo-Cincochan said the stronger performance may have been partly driven by customers accelerating purchases for ongoing projects amid expectations of price increases tied to rising oil costs and war in the Middle East.
Comparable sales growth stood at 4.7 percent for the period, while three new depot stores opened during the quarter, all located in Luzon.
Depot-format stores remained the main revenue driver, contributing P8.83 billion or 96.3 percent of total net sales, up 8.8 percent year on year.
Do-It-Wilcon (DIW) stores generated P285 million, accounting for 3.1 percent of the total, with sales rising 10.4 percent.
Project sales, though a small portion of total revenues, surged 62.9 percent to P56 million.
Gross profit increased by four percent to P3.39 billion, but gross profit margin narrowed to 37.0 percent, Wilcon said, adding this reflected a higher mix of lower-margin non-exclusive products and weaker margins in select categories, while the share of exclusive and in-house brands declined to 51.7 percent.
Operating expenses climbed 4.1 percent to P2.77 billion, driven mainly by higher depreciation expenses from newly opened stores, as well as increases in utilities, logistics, and outsourced services.
Other income rose 8.7 percent to P120 million, supported by improved collections from supplier-related fees and rental income.
Capital expenditures reached P417 million in the quarter, equivalent to 16.1 percent of the company’s full-year budget.
Belo-Cincochan said the company remained on track to open eight stores this year, with three already completed and the remaining five in various stages of construction.
“While the situation in the Middle East creates some uncertainty and may temporarily disrupt our growth trajectory, we’re confident in our direction and the resilience of our business,” she said, adding that the firm would remain “agile and prudent” in navigating potential headwinds.
Wilcon shares on Tuesday dropped P0.03, or 0.48 percent, to close at P6.17 each.
