Parkson records RM13m loss in Q2

Parkson retail mall in China

KUALA LUMPUR: Parkson Holdings Bhd posted net losses of RM13.87mil in the second quarter ended Dec 31, 2017, compared to net earnings of RM72.67mil in the previous corresponding quarter despite a 1.7% improvement in revenue to RM1.065bil.

The group said the loss stemmed from an impairment loss of RM36mil, which resulted in a loss before tax of RM3mil for the quarter. Excluding the impairment, the higher revenue coupled with operational efficiencies gave the group an operating profit of RM27mil.

For the first six months of the financial year, Parkson turned in a net loss of RM57.4mil compared to a net profit of RM10.1mil in the year-ago period.

In Malaysia, Parkson's retailing operations saw revenue growth of 4% to RM505mil due to the contribution of new stores but an operating loss of RM19.79mil compared to RM1.89mil profit a year ago.

"The operations reported a negative same store sales (SSS) growth of 4% for the first half of the current financial year largely due to the absence of Hari Raya buying following the shift in festive calendar," it said. 

In China, the operations posted SSS growth of 2% year-to-date with revenue increasing 4% to RM1.32bil in the first half of the financial year. Parkson China reported an operating profit of RM32mil against a loss of RM85mil a year ago.

In Vietnam, Parkson reported negative SSS growth of 5% for the period amid intense competition while Myanmar operations remained negligable.

Parkson's Indonesia operations posted negative SSS growth of 8% with a lower revenue of RM86mil. 

The group's consumer financing business, Parkson Credit, recorded improved revenue of RM25.7mil over the six months period from RM20.97mil a year earlier. It turned in a lower operating loss of RM10mil from a loss of RM24.54mil previously.

"The improved profitability of Parkson Credit together with lower losses from other businesses have resulted in the division to record a lower operating loss as compared with a year ago," said the group.

Parkson said its retailing operations will benefit from the higher consumer spending during the Chinese New Year festivities taking place in the third quarter of the financial year.

"The Group remains confident in our China retailing operations and believes that the Group's transformation strategies focusing on diversified retail formats coupled with stores' network optimisation and products offering enhancement, are keeping the Group on the right track. 

"While the Group's operating environment in the Southeast Asian region is anticipated to remain challenging over subdued consumer sentiment and stiff competition, the Group will continue to monitor its strategy execution as well as stores' performance."