Review of Current Quarter Performance versus Corresponding Quarter Last Year 

The Group registered an overall revenue of RM684.2m for the current quarter ended 31 March 2024,  representing an increase of RM28.2m or 4.3% compared to the corresponding quarter last year.  

The Convenience Stores segment recorded a positive performance, with revenue rising by RM28.2m  or +4.3% to RM684.2m compared to the previous year's corresponding quarter. The rise in revenue  attributed to factors such as increased customer count and improved product offerings in the current  quarter.  

Operating Expenses increased by RM20.7m or +10.2%, primarily due to higher store operation-related  expenses driven by longer operating hours and the addition of 88 net new stores, bringing the total  number of stores to 2,581. An expansion in our workforce to meet anticipated business demands also  contributed to this increases.  

In the current quarter, we successfully rolled out 189 new 7-Café store formats, bringing the total count  to 305 7-Café stores. It is encouraging to note that these 7-Cafés have proven to be more productive  with higher fresh food sales participation compared to classic stores.  

PROSPECTS  

The prevailing economic landscape has been marked by significant challenges, notably characterized  by the escalation of geopolitical tensions and higher costs of living, especially with the recent increase  in the Sales and Services Tax in March 2024. That said, the local economy is expected to be driven  mainly by resilient domestic spending, supported by sustained growth in employment and wage  growth. Tourist arrivals and spending are expected to improve further. In this regard, the Group will  remain vigilant and is dedicated to implementing necessary measures to navigate effectively through  these headwinds and opportunities.  

Our focus for the Convenience Stores segment continues to be on the expansion of our 7-Café store  format, aimed at enhancing product offerings and elevating the in-store customer experience.  Anticipated to drive growth in our fresh food category, the 7-Café format will play a pivotal role in  diversifying our sales mix and improving margins. On-going initiatives include the establishment of  new 7-Cafés outside of Klang Valley, complemented by tactical plans to penetrate specific high  potential locations. Additionally, we will continue our advisory mission with our Japanese partner, to  focus on expanding our fresh food commissary offerings and improving production yield by optimising  high quality raw materials, adopting best operational practices and discipline.  

We will continue to expand our private label offerings as we seek to continuously deliver value to the  emerging group of modern, brand agnostic consumer, where the focus solely on brand per-se is  gradually vanishing in favour of a focus on the product itself and its attributes. Last but not least, in  line with our customer-centric strategy, we will be conducting more regular consumer research and  insights, leveraging the voice of the consumer through social listening and brand health studies to  continuously improve our services and product offerings.  

With regards to the Indonesian pharmaceutical business, we will continue to collaborate closely with  our joint venture partner with an immediate focus on the overall strategic roadmap, including store  expansion plans, product range and pricing review, marketing activation and driving a consumer  centric operation.  

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