Lockdown pulls down Robinsons Retail profit by 14% to P2.4 billion

Published October 30, 2020, 5:30 AM

by James A. Loyola

Robinsons Retail Holdings, Inc. reported a 13.9 percent drop in attributable net income to P2.4 billion in the first nine months of 2020 due to the impact of quarantine restrictions imposed to stem the spread of COVID-19. 

In a disclosure to the Philippine Stock Exchange, RRHI noted though that, third quarter overall results show an upward trend compared to the previous quarter, signifying that the retail climate bottomed out in the second quarter of 2020, which had stricter lockdown restrictions.

“Our third quarter 2020 financials give us some optimism that the worst may have passed for RRHI and the retail sector,” said RRHI President and CEO Robina Gokongwei Pe.

She noted that, “Compared to the second quarter, we saw significant improvements in our results across the majority of our formats. We are hopeful that the uplift continues for the rest of the year.”

Pe added that, “COVID-19’s impact on people, businesses, and the overall economy is still very much felt and apparent, and our year-on-year numbers remain down. Yet we are seeing signs of recovery amidst an age of social distancing and safety precautions, and all of us are adapting to this new dynamic in retail. Through any disruption, we are committed to bringing the best products and services that we can to our customers.” 

Consolidated net sales declined by 5.7 percent to P109.6 billion in the first nine months of 2020, as the Company continued to weather the challenges of COVID-19.

Discretionary formats were affected by a temporary reversion to the Modified Enhanced Community Quarantine (MECQ) in Metro Manila and nearby provinces from August 4 to 18, 2020. Limited transportation and consumer mobility also affected foot traffic in malls. 

“Although they remain cautious, customers and businesses are adjusting to the new normal with safety measures implemented in stores. At same time, consumers are also exploring alternative channels to purchase goods from virtual platforms, such as Viber communities and social media marketplaces, which is now collectively referred to as social commerce,” RRHI noted. 

Blended same store sales growth (SSSG) was negative 6.4 percent in the first nine months of 2020 and negative 11.7 percent in the third quarter.

Supermarket SSSG was up 11.5 percent for the first nine months of 2020 and 2.1 higher in the third quarter, the latter of which was partly attributed to weaker consumer spending given the overall decline in disposable income.

Drugstores, an essential format, registered positive SSSG of 3.5 percent in the first nine months of 2020. However, coming from a high base last year, the segment experienced a negative 3.0 percent SSSG in the third quarter, due to a drop in sales of prescription flu and anti-bacterial medicines. The rest of the formats registered negative SSSG for the third quarter, but showed better performance than their negative SSSG in the second quarter when they were closed for six weeks.