TIDMDFI TIDMJAR
RNS Number : 8913Z
DFI Retail Group Holdings Ltd
18 May 2023
Announcement
The following announcement was issued today to a Regulatory
Information Service approved by the Financial Conduct Authority in
the United Kingdom.
DFI RETAIL GROUP HOLDINGS LIMITED
Interim Management Statement
18th May 2023 - DFI Retail Group Holdings Limited today issues
its Interim Management Statement for the first quarter of 2023.
The Group saw significantly improved year-on-year performance in
the period. The Group's subsidiaries reported a modest increase in
operating profit, with a strong recovery in the Health and Beauty
and Convenience divisions mostly offset by lower results in the
Grocery Retail division, as consumer buying patterns normalised
following exceptional performance in the first quarter of 2022 and
digital investments continued. Underlying profitability for
associates increased significantly, with Maxim's achieving much
improved performance.
North Asia Grocery Retail sales were lower than in the
equivalent period last year, when demand was boosted by the fifth
wave of COVID in Hong Kong. Southeast Asia Grocery Retail sales
performance was impacted by cautious customer shopping behaviour,
driven by rising cost of living pressures. Although Grocery Retail
profitability reduced relative to the first quarter of 2022, it
remained higher than in the first quarter of 2019, with
particularly encouraging market share growth in Wellcome.
The Convenience division reported strong like-for-like sales
growth across all markets in the first quarter, as economies
reopened. 7-Eleven Hong Kong reported strong like-for-like sales
growth, underpinned by the effective execution of a range of
commercial activities including new product development and
effective promotions. 7-Eleven South China reported improving sales
momentum across the quarter, driven by strong promotion execution,
improved foot traffic and strong progress in the digitisation of
customer-facing systems.
Overall profitability for the division, though still below 2019,
improved significantly compared to the prior year, driven by strong
year-on-year sales recovery.
The Group's Health and Beauty division reported substantial
sales and profit growth in the quarter. In North Asia, Mannings saw
double-digit like-for-like sales growth, as Hong Kong's border with
the Chinese mainland reopened and health-related sales remained
strong. Effective in-store execution led to a record market share
in Hong Kong. In Southeast Asia, Guardian also reported strong
sales growth compared to the prior year, particularly in Malaysia
and Indonesia. Overall profitability of the division more than
doubled, leveraging sales recovery as well as ongoing promotional
optimisation and robust cost control. While overall Health and
Beauty profitability remains below 2019 levels, the early pace of
recovery is encouraging.
Home Furnishings sales revenue in the first quarter was behind
that in the same period last year. Sales were impacted by reduced
demand for furniture, with border reopening likely driving
short-term discretionary spending toward leisure activities,
particularly in Hong Kong and Taiwan. Profitability for the
division has also reduced relative to the prior year due to these
trading challenges, with the impact on profitability partially
offset by robust cost control. IKEA remains focussed on delivering
increased accessibility through format innovation and new
touchpoints.
Revenue and profit for Maxim's, the Group's 50%-owned associate,
grew substantially in the first quarter relative to the prior year,
due to increased restaurant patronage, as COVID-related restraints
on trading fell away in Hong Kong and the Chinese mainland.
Yonghui's first quarter sales were impacted by the absence of
panic buying seen in the same period last year. Despite this,
reported profitability increased in the period, supported by higher
gross margins and reduced costs. Robinsons Retail reported robust
like-for-like sales growth in the first quarter of 2023 compared to
the prior year, with strong performances from the supermarket,
drugstores, department stores and convenience stores segments,
which together delivered double-digit revenue growth. Robinsons'
underlying profitability also increased, although reported
profitability was impacted by higher interest expenses, foreign
exchange movements and lower earnings from associates.
On 2nd May 2023, the Group announced that Ian McLeod would be
succeeded by Scott Price as Group Chief Executive of DFI Retail
Group Holdings Limited with effect from 1st August 2023.
The Group remains optimistic on the outlook for the remainder of
the year. The reopening of the Hong Kong border and the continued
recovery in our Southeast Asian markets has driven positive trading
performance in the first quarter, although there remains some way
to go before the business will see the level of overall
profitability achieved in 2019. Global economic headwinds remain
and, while inflationary pressures are easing, consumer confidence
is uncertain and will have a bearing on both the speed and degree
to which behaviours return to pre-pandemic levels. Recognising the
sustained shift to online digital convenience, the Group will
continue its investment in digital platforms in order to compete.
The Group's business transformation has delivered strong underlying
improvements and a solid foundation for the business and we remain
focussed on its continued execution to deliver sustainable growth
for our shareholders; a stronger business for our customers; and a
supportive organisation for our team members.
DFI Retail Group is a leading pan-Asian retailer. The Group,
together with its associates and joint ventures, operates around
10,600 outlets - including supermarkets, hypermarkets, convenience
stores, health and beauty stores, home furnishings stores and
restaurants - employing some 216,000 people, and had total sales in
2022 exceeding US$27 billion. The Group's parent company, DFI
Retail Group Holdings Limited, is incorporated in Bermuda and has a
primary listing in the standard segment of the London Stock
Exchange, with secondary listings in Bermuda and Singapore. DFI
Retail Group is a member of the Jardine Matheson Group.
- end -
For further information, please contact:
DFI Retail Group Management Services
Limited
Christine Chung (852) 2299 1056
Brunswick Group Limited
William Brocklehurst (852) 5685 9881
This and other Group announcements can be accessed through the
Internet at 'www.DFIretailgroup.com'.
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