Parkson Retail Asia has reported a 24.6 per cent slump in net profit – largely attributed to new store establishment costs.
The Singapore-based department store operator has reported a second quarter trading profit of S$10.23 million.
The company’s biggest problem markets appear to be Malaysia and Vietnam where same store sales are showing negative growth. And in Vietnam the company accrued costs relating to the closure of a store in the capital city, Hanoi.
Total sales revenue was flat at S$117.52 million in the three months to December 31, while expenses rose 6.6 per cent to S$109.5 million.
In the half year to December 31, net profit fell 28.2 per cent to S$17.09 million, on revenue a marginal 0.6 per cent higher at S$227.51 million.
In a statement, group CEO Toh Peng Koon said the closure of the Landmark-Keangnam store in Hanoi resulted in removing “a major drag on our operating performance” there.
“While we expect Malaysia’s consumer sentiment to remain muted in the near term, consumer buying prior to the introduction of the Goods and Services Tax on April 1 may provide us with some buffer.
“We feel confident that the strategies we have initiated to improve our fundamentals will reap the desired results going forward. With our healthy balance sheet and strong cash generation from our operations, we are well-positioned to continue to identify and make prudent investments necessary to growing our business.”