Amid a slowdown in the residential construction and home improvement retail business, tycoon Lucio Co’s retail holding firm Cosco Capital Inc. has canceled its planned P500 million joint venture into the industry with a Thai company sealed in 2022.

In a disclosure to the Philippine Stock Exchange, Cosco said its management has decided on the termination on Dec. 23, 2024 of the Joint Venture Agreement it entered into with Siam Global House Public Company Limited.

“At present, the management of both parties mutually decided to no longer proceed and finally terminate the agreement. This decision was mutually arrived at after strategically reviewing the current market conditions,” Cosco said.

Siam Global operates 76 stores in Thailand, selling building and construction-related materials, home and garden decorative goods, home improvement goods, construction equipment, and tools.

In 2022, Cosco signed a Joint Venture Agreement with Siam Global to establish and operate a retail shop or warehouse specific for building and construction-related materials, home and garden decorative goods, home improvement goods, construction equipment, and tools in the Philippines.

The transaction was supposed to be in line with the expansion program of Cosco Capital, which would enable it to invest through a joint venture with a foreign group into a new line of business that would be accretive in terms of investment income for the Company.

Under their joint venture agreement, Cosco would have had a 45 percent stake in the new company while Siam Global would have owned the controlling 55 percent.

Cosco Capital reported a 10 percent improvement in consolidated net income to P10 billion for the first nine months of 2024 from the P9.1 billion earned in the same period last year.

The firm said strong operating performance from all business segments also lifted consolidated revenues by 9.1 percent to P164 billion for the nine-month 2024 period from P150.3 billion in the first three quarters of 2023.

“The Group continued to benefit from the economic recovery amidst the prevailing macroeconomic challenges by way of sustained and stronger revenue growth across all its business segments, which indicates the recovering consumer demand,” said Cosco.

The group's grocery retailing businesses, Puregold Price Club, Inc. and S&R Membership Shopping Club, contributed 69 percent of total net income, followed by the Liquor Distribution with 22 percent, Commercial Real Estate segment with seven percent, Energy and Minerals with 1.5 percent, and Specialty Retail with 0.5 percent.

Meanwhile, the company said its Board of Directors approved an additional budget of P2 billion for its Share Buy-Back Program.