Profit slump for 7-Eleven Malaysia

7-Eleven Malaysia has reported a heavy 42.8 per cent slump in net profit to RM24.7 million, (US$5.7 million).

Sales for the second quarter grew 9.8 per cent year-on-year to RM555.2 million (US$130 million), with a 4.4 per cent year-to-date increase to RM1.08 billion for the half-year, attributed to the Hari Raya festive period and store expansion.

However, the group’s second-quarter after-tax profit tumbled 32.7 per cent.

The average spend per customer grew by 2.6 per cent quarter on quarter and 1.3 per cent for the first half, while gross profit margin continues to improve, the convenience store retailer reports.

Same-store sales showed 2.4 per cent growth, while 77 stores were added to the network this year giving a total of 2186 at the end of June.

Selling and distribution expenses for the quarter increased by RM24.2 million or 17.1 per cent, mainly due to the impact of minimum wage increase which took effect on July 1 last year, store expansion, depreciation and inventory shrinkage.

“We achieved significant improvement in our revenue and net profit in the second quarter,” says acting CEO Ho Meng. Revenue rose 6.3 per cent for the period while net profit shot up 26.8 per cent.

“We are confident our strategic review and the implementation of our “Back to Basics” program will strengthen and solidify 7-Eleven Malaysia.

She says there will be a key focus on fresh food and In-store services going forward.

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