Closing unprofitable stores in Singapore, International Housewares Retail recorded its highest-ever revenue for its first half to the end of October.
Its interim consolidated results shows revenue rising by 5.7 per cent to an historical high of HK$1.06 billion (US$135.5 million). Profit attributable to equity holders of the company rose 15 per cent to $39.4 million.
The group’s gross profit rose by 4.1 per cent to $490.3 million, while gross profit margin maintained a “healthy level” of 46.3 per cent, down from 47 per cent for the same period last year.
“During the period, the discount-driven marketplace made more promotions and markdowns necessary, placing considerable pressure on our gross profit margin,” says the company. “Fortunately, much of that pressure was offset through the group’s continued effort to streamline logistics and bargain for more favourable prices.”
Hong Kong remained the key market of the Group, accounting for 87.1 per cent of its
total revenue and reaching a record high of $923.2 million, a 5.5 per cent increase. Same-store sales achieved 4.6 per cent growth and net profit was $44.1 million, up 12.3 per cent.
During the first half, a management team reshaped the merchandise offering in Singapore, clearing and re-allocating slow-moving products. Inventory turnover improved and the group was able to convert old inventory into cash. Revenue increased by 9.9 per cent to $119.4 million.
Hit by a typhoon in August, Macau had a 5.8 per cent drop in revenue to $17.4 million, but maintained profitability.
Meanwhile, says the company, more customers are ordering online at JHCeshop and collecting their purchases in physical stores. As a result, the group is taking on a new retail business model, integrating its physical stores with e-commerce business. This has included introducing an in-store online shopping iPanel, Easy Buy, offering customers a broader range and exclusive online products, plus the option to pick up products at their preferred store.
At the end of October the group had 363 stores worldwide. The housewares retail chain says it has been opening smaller stores to better control rental expenses as it expands.
Established in 1991, the group has a retail network covering Australia, Cambodia, Hong Kong, Macau, Malaysia, Saudi Arabia and Singapore, with a store being added in Vietnam during the first half. Its retail brands include 123 by Ella, City Life, Easy Buy, Japan Home, JHC, JHC Concept Store and JHCeshop.