MANILA, Philippines – Facing a more competitive environment, the country's largest specialty store retailer SSI Group, Incorporated saw its net income for 2015 slide by 18.8% to P810.7 million ($17.52 million) from P998 million ($21.58 million) in 2014.
"SSI faced a more competitive environment during the 2nd half of 2015," SSI Group president Anthony Huang said in a disclosure to the local bourse.
In the Philippine 24-hour convenience store segment, SSI's FamilyMart faced increased competiton with the expansion of Japanese brand Lawson in the country, which opened 16 stores located near schools in Metro Manila in 2015.
Other than Lawson, FamilyMart also competes with 7-Eleven, Ministop, Manuel Villar's All Day, and Indonesia's Alfamart, among others.
SSI Group told the Philippine Stock Exchange that its share in the net losses of convenience store FamilyMart and department store Wellworth increased to P228.3 million ($4.94 million) last year, compared to P144.9 million ($3.13 million) in 2014.
Grow market share
Despite its lower net income, SSI Group said it remains focused on growing its market share and optimizing the efficiency of its store network.
"SSI continues to be in a strong competitive position given the breadth and relevance of our brand portfolio and our store network," Huang said.
Revenues increased by 15% to P17.4 billion ($376.38 million) driven by new stores added to the group's network and by its diversified brand portfolio.
As of 2015, the group was operating 792 specialty stores, covering more than 147,000 square meters, a 10% increase in the company's retail footprint from 2014.
The group's brand portfolio consists of 116 brands.
"The scale of SSI's network testifies to the group's success and strength in constructing and operating specialty stores for international brand principals, which in turn facilitate its negotiations for favorable store-related arrangements, allowing for realization of cost savings and greater efficiencies in its store development processes," SSI Group said.
Meanwhile, operating income fell to P1.8 billion ($38.94 million) in 2015, from the 2014 level of P1.9 billion ($41.10 million), as operating expenses increased.
The retailer ended 2015 with 112 FamilyMart stores through its joint venture with Ayala Land, Incorporated and FamilyMart Japan.
SSI Group last month sold two department stores under the Wellworth brand to Gaisano-owned Metro Retail Stores Group Incorporated. – Rappler.com