Wilcon Q1 profit: P536-M (down 28%)

Wilcon [WLCON 6.59, down 4.3%; 0% avgVol] [link] reported a Q1/25 net income of P536 million, which was 27.5% y/y lower than the P740 million in posted in Q1/24, but 30% q/q higher than what it did last quarter. WLCON’s management said that sales from new stores helped push the company’s Q1/25 net sales 1.2% higher y/y. They attributed the poor overall performance to “lower sales in the first two months of the year”, but they’re optimistic about Q2 and H2 if the “encouraging average daily sales” trends from the weeks before and after Easter hold.

MB bottom-line:  There’s a lot to like about WLCON’s positioning relative to its competition (AllHome [HOME 0.60, down 4.8%; 586% avgVol]), but as an outsider, it’s hard for me to wrap my head around the multi-year narrative that the market has simply been weak/soft. I’ve seen a lot of high-level excuses for why customers aren’t spending as much money, ranging from inflation to the weather, but I haven’t heard a lot of proactivity from WLCON’s management team on how they’re going to operate in this new normal. Waiting for the past to return isn’t a valid strategy in most cases. WLCON’s dad left to buy smokes in 2023, and it feels like it needs to give up hoping that he’ll come back home. It’s been long enough. 

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