Puregold profit rises 24.5% in Q1

MANILA, Philippines - Puregold Price Club Inc. grew its net income by 24.5 percent in the first quarter this year to P469 million as it registered higher sales.

In a financial report submitted to regulators yesterday, Puregold said net sales rose 30.3 percent to P10.74 billion, primarily due to higher turnover as a result of new store openings in the last three quarters of 2011.

Puregold had a total branch network of 101 as of March 31, 2012, comprising 62 hypermarkets, 28 supermarkets and 11 discounters. These new stores accounted for 17.7 percent of total net sales for the period under review.

Operating income amounted to P633 million, up 18.6 percent from P534 million. Other income jumped 27.9 percent to P288 million.

On the other hand, operating expenses shot up 38 percent to P1.4 billion from P1.01 billion, largely due to the company’s expansion and renovation of old stores.

Puregold is expected to sustain its upward trajectory for the rest of the year, especially with the acquisition of the upscale S&R Membership Shopping Club through a P16.5-billion share swap transaction.

The move was intended to consolidate Chinese-Filipino businessman Lucio Co.’s retailing businesses under one umbrella.

Under the deal, the Co family will own approximately 77 percent of Puregold’s outstanding shares.

The planned consolidation will expand Puregold’s current market base, enhance shareholder value, and achieve economies of scale.

S&R currently has six branches located in Bonifacio Global City, Alabang, Congressional Ave. in Quezon City, Aseana-Baclaran, Cebu and Pampanga.

Puregold aims to double its store network by 2015 as it continues its expansion and seize new markets in the Visayas and Mindanao.