Robinsons retail hikes spending to P7 billion for 2014

By VG Cabuag, BusinessMirror

Posted at Jun 26 2014 07:53 AM | Updated as of Jun 26 2014 03:53 PM

MANILA - Robinsons Retail Holdings Inc. on Wednesday said it will more than double its capital expenditures for the year as it plans to fast track its expansion plans by buying more companies to fuel its growth for the coming years.

The Gokongwei-controlled firm said it will spend some P7 billion this year, up from the P2.8 billion it spent last year.

“Gross margin will continue to increase due to organic growth, but mergers and acquisition will continue to be an ongoing exercise for us,” Robina Gokongwei-Pe, the company’s president and CEO, said during the company’s stockholders’ meeting.

Gokongwei-Pe said the company will add some 300 stores this year, some 21 of which will be new supermarket branches, four are department stores, 25 are in the do-it-yourself format, some 100 to 120 are convenience stores under the Ministop brand, 80 to 100 are drug stores and 50 to 55 are specialty stores.

She said the company expects to end the year at 1,400 stores from last year’s 1,145 stores.

Robinsons Retail will also add two segments under the supermarket business. One will be under the brand Robinsons Selections for the upscale market, and the other is the Robinsons Easymart for the lower-end segment.

Company executives said Robinsons Retail will fund its capital expenditures using the P26-billion proceeds from its initial public offering.

Gokongwei-Pe said the company will expand more aggressively in the Visayas and Mindanao area this year as these areas present more growth than in Metro Manila, where competition from other bigger players are stiff.

She said the Gokongwei’s modern retail store penetration in the Visayas and Mindanao was only at 10 percent, while revenue contribution was around 20 percent.

Robinsons Retail recorded a net income of P643 million for the first three months of the year, a 2.4-percent increase from P621 million last year.