Review of Current Quarter Performance versus Corresponding Quarter Last Year
For the current quarter, consumer-related activities expanded with the re-opening of the economy vis-à-vis the relaxation of COVID-19 containment measures under the National Recovery Plan. Notably, with the resumption of interstate travel, coupled with longer trading hours as compared to the previous year's corresponding quarter, the Convenience Stores segment recorded higher APSD and customer count, leading to a turnaround in SSSG of +18.8%. In this regard, Revenue increased by RM92.6m or +21.7% to RM520.2m, with an increase across all product categories, resulting in higher Gross Profits by RM42.8m or +34.9% to RM165.6m.
Operating Expenses increased by RM15.3m or +10.8%, driven by higher store operation related expenses. Excluding corporate exercise expenses, the Convenience Store segment recorded a Core Profit After Tax of RM25.9m.
Meanwhile, Revenue from the Pharmaceutical segment for the current quarter increased by RM110.6m or +67.4% to RM274.8m, in tandem with continued consumer focus on personal well being and overall healthcare. Additionally, the acquisition of The Pill House and Wellings group contributed a revenue of RM84.4m for the current quarter. As a result, Profit After Tax increased by RM4.5m or +62.5% to RM11.7m.
Corporate exercise expenses of RM4.7m primarily consists of Finance costs for the acquisition of Caring Group.
The Group’s consolidated Profit After Tax for the current quarter after corporate exercise expenses is reported at RM32.8m, an increase of RM27.3m or +493.9%.
Review of 12 Months Period Performance versus Corresponding Period Last Year
With the overall shorter operating hours in year 2021, Revenue from the Convenience Stores segment declined by RM252.9m or -12.3% to RM1,810.6m with most product categories recording lower Revenue, thereby resulting in lower Gross Profits. Excluding corporate exercise expenses, the Convenience Store segment recorded a Core Profit After Tax of RM40.2m, a decline of RM7.7m or
-16.1%.
Revenue from the Pharmaceutical segment increased by RM523.0m or +110.0% to RM998.5m, while Profit After Tax closed at RM42.0m. The acquisition of The Pill House and Wellings group contributed a Revenue of RM260.0m for the year.
The Group’s consolidated Profit After Tax for the 12 months ended 31 December 2021, after corporate exercise expenses is reported at RM58.8m, an increase of RM23.5m or +66.4%.
PROSPECTS
The Group is optimistic on the recovery of Malaysia’s economy in 2022, projected to be driven by normalisation in economic activities. Despite the emergence of the new COVID-19 variants, trading conditions are expected to turnaround with increased business and consumer confidence, in line with the high nationwide vaccination rate.
In the coming year, the Convenience Store segment will focus on rolling out its new 7 Café store format, a refreshed concept with much improved product offerings and in-store customer experience. In addition, the said 7 Café format is expected to contribute positively to the growth of fresh food category.
The Pharmaceutical segment, which had shown much resilience over the pandemic, will continue to strengthen its market share together with The Pill House and Wellings group. And through the recently announced joint venture with PT Era Caring Indonesia, the Group will mark its foray into the Indonesian market, operating a network of pharmacies under the brand “Wellings” in 2022.
