China’s largest hypermarket chain has posted a profit fall of 15.7 per cent, its first yearly decline since it listed in Hong Kong in July 2011.

Sun Art Retail Group, a joint venture between Taiwanese conglomerate Ruentex Group and French retailer Groupe Auchan, says its chain faced intense competition from eCommerce outlets to post a net profit last year of 2.4 billion yuan (US$373.15 million) – a drop from from 2.9 billion yuan in 2014.

“The pressure on offline retailers from the rapid growth in eCommerce platforms will persist for us,” says chairman Cheng Chuan-Tai. “The group will continue to push for the development of its eCommerce business.”
Competing with China Resources and Wal-Mart Stores on the mainland, Sun Art opened 38 more stores during the year, taking its total to 409. It says it will adjustment expansion, product mix and logistics.
Turnover rose to 96.4 billion yuan from 91.9 billion yuan a year earlier, while the gross profit margin increased 0.4 points to 23.3 per cent.
Same-store sales fell 3.6 per cent, compared with a 1.6 per cent decline in 2014, attributed to slower growth in the consumer market, a wider choice of outlets for customers and intensified competition.