Home improvement and finishing construction supplies retailer Wilcon Depot reported that its net income declined by 31.8 percent to P1.45 billion last year.
In a disclosure to the Philippine Stock Exchange, the firm said net sales decreased by 7.5 percent to P22.63 billion as the COVID-19 pandemic and the consequent quarantine measures had greatly impacted operations.
Wilcon said the two-month closure of the company’s Luzon branches and the continuing stringent quarantine measures particularly in Metro Manila mainly drove the drop in comparable sales.
“The Company remains committed to its growth plans despite the temporary setback and has in fact proceeded with the opening of new stores albeit two of the planned eight new stores for 2020 were pushed back to January 2021,” Wilcon said.
It closed the year with 63 branches nationwide, achieving its IPO commitment of a 65-strong store network in January 2021, still ahead of the original end-2021 schedule.
Wilcon’s President and CEO Lorraine Belo-Cincochan said the Company will continue with its expansion plans and will open nine new stores in 2021. Two were opened in January 2021 with seven more to be opened for the year.
The company budgeted P3.2 billion for its planned capital expenditure for the year which includes the new stores and warehouses, renovations and extensions among others.
Net sales for the fourth quarter totaled P6.84 billion, up 6.2 percent year-on-year due mainly to the contribution of new stores as comparable sales performance was flattish at negative 0.5 percent.
Other income jumped 45.4 percent to P193 million in view of the full recognition of the rent concession obtained from lessors partly offset by the reduction in interest income and net other income and charges from trade and other suppliers.
Net income for the quarter was down 3 percent to P563 million traced mainly to the drop in interest income. Excluding interest income, earnings would have been slightly up by 1.1 percent year-on-year.
Wilcon’s depots, accounting for 97.0 percent or P21.94 billion of 2020 net sales, grew by 6.5 percent from the 23.469 billion net sales generated in 2019 but with a negative same store sales growth of 12.9 percent for the year.
Net sales generated by the smaller format, “Home Essentials” (HE) stores, comprising the 2.2 percent of total net sales, likewise reported a drop of 22.4 percent for the year since six out of the seven Home Essentials are located in Metro Manila.
The remaining 0.8 percent was accounted for by the project sales or sales to major developers, amounting to P178 million, decreasing by 49.2 percent owing to the suspension of and delays in the completion of ongoing projects of our institutional accounts.