Another record high in annual revenue from its key market, Hong Kong, has been reported by International Housewares Retail Company for the year ended April 30.
Hong Kong generated 86.1 per cent of the group’s total revenue, its record total being HK$1.755 billion (US$226.3 million), a 6.3 per cent increase over the previous year’s HK$1.65 billion. Comparable store sales showed “relatively healthy” growth of 5.3 per cent.
Overall, the group’s revenue rose 4.5 per cent to $2.04 billion. At year end, the group had 358 stores – in Hong Kong, Singapore, Macau, Cambodia, Indonesia, East Malaysia, Saudi Arabia and New Zealand, of which 347 were directly managed and 11 licensed.
In Hong Kong, the group had a comparable store sales growth of 5.3 per cent, down from 8.2 per cent the previous year. However, its gross profit grew by 5 per cent to $947.6 million from $902.8 million.
“With the global economy remaining uncertain and our peers giving major discounts and mounting more promotions, the overall operating environment continues to be challenging,” says the company. “However, given the large global supplier network we have built over 25 years, we have the ability to secure a stable and continuous supply of a wide variety of products at competitive prices.”
Leap of 65 per cent
International Housewares Retail says its Hong Kong business performed particularly well, with the adjusted net profit leaping 65.7 per cent for the second half of the year compared with the first six months. It attributes the growth mainly to stores opening and growth in comparable store sales. There were also more transactions with the average spend per transaction up, plus the company continued to increase the variety of merchandise.
“We believe our comparable store sales growth in Hong Kong as well as the increasing revenue from Singapore and Macau demonstrates our growth potential in these regions.”
In Singapore, revenue grew by 3.7 per cent in the face of conservative consumer spending, with same-store sales falling 1.9 per cent – an improvement over the previous year’s dip of 8.9 per cent.
Macau’s revenue grew 7.6 per cent to $39.3 million while comparable store sales growth was 1.3 per cent, down from 5.9 per cent the previous year.
Meanwhile, the group closed down its businesses in mainland China and west Malaysia to minimise their adverse effects.
Concept stores
Looking ahead, the group will continue to focus on the Hong Kong market, where it is renovating its stores. It will also keep expanding its retail network, and regards Singapore as an important market.
During the year, the group opened concept stores in Hong Kong under the Japan Home Center brand in Central, Whampoa and North Point. It also opened stores branded 123 by Ella, based on the “simple and fast consuming” concept of selling selected trendy and personal merchandise at a range of fixed prices.
International Housewares also launched an eCommerce business in Hong Kong aimed at expanding its regional presence, and has continued to leverage the power of online marketing by introducing mobile apps and on social-media platforms such as Facebook and WeChat.
At the same time, the group intends its logistics and delivery system to become increasingly important.
At the end of the year, the group’s loyalty program had about 400,000 members in Hong Kong, accounting for about 14 per cent of the total retail business revenue in the city.