Lucio Co-led grocery retailer Puregold Price Club Inc. is reducing its capital expenditures to ₱6.35 billion this year from the ₱8.1 billion it alloted in 2024 although it expects to grow consolidated revenues by six percent to eight percent in 2025.
For this year, Puregold is alloting ₱1.9 billion for 30 new Puregold stores as well as ₱3 billion for three S&R Membership warehouse stores and 14 S&R quick service restaurants.
The firm is also earmarking ₱200 million for logistics capex and ₱1.25 billion for maintenance capex, solar projects, and information technology upgrades.
For the next two years, Puregold aims to grow its business by expanding its organic store network by eight percent to 10 percent in more provincial areas (second—to fourth-class municipalities) and developing and expanding Puremart in dense communities.
The firm acquired Puremart’s 153 stores for ₱568 million last year to address its need to fill the gap in “proximity shipping.” It noted that Puremart stores, at an average of 150 square meters each, are cheaper to put up at a cost of about ₱2.5 million each.
The firm also aims to increase the number of its loyal shoppers through wholesale initiatives and marketing programs, localized assortment, pricing, and promo initiatives, as well as develop its hospitality, restaurants, and cafes business.
It also aims to increase basket size and profit margins by disproportionately growing its Fresh category and house brands as well as enter into joint business plans with top suppliers to grow base brands and develop growth categories.
To support its Fresh plans, Puregold aims to develop a robust cold chain and structure and reinvent its end-to-end supply chain.
With these measures, Puregold expects to grow its gross profit margin to hit the 15.5 percent to 16.5 percent target for Puregold stores and up to 21.5 percent to 22.5 percent for S&R warehouses.
“As we look to 2025, we are implementing an aggressive store expansion strategy, prioritizing key provincial markets,” said PGOLD President Ferdinand Vincent Co in a disclosure to the Philippine Stock Exchange.
He added, “This strategic initiative is designed to drive continued growth, expand our market footprint, and enhance customer shopping satisfaction, convenience, and accessibility, ultimately positioning us for long-term value creation.”
PGOLD reported a 21.3 percent growth in consolidated net income to ₱10.4 billion last year from ₱8.6 billion in 2023, driven by strong topline growth and an improvement in gross margins for its S&R business.
The firm said it consolidated revenues improved 10.1 percent to ₱219.17 billion for 2024 from ₱199 billion in 2023.
For 2024, the enterprise experienced positive same-store sales growth (SSG) of 4.5 percent from Puregold Stores and 6.4 percent from S&R Warehouse clubs driven by higher traffic and basket size.
“Our company has delivered record-breaking earnings, demonstrating resilience and strong performance even in the face of challenging market conditions. This success is a direct result of the sustainable growth and proven profitability of our core business,” said Co.
As of end December 2024, PGOLD opened 26 new Puregold stores, four S&R Membership Shopping Warehouse and eight S&R New York Style QSR. PGOLD operates 602 stores nationwide, comprising 511 Puregold stores, 29 S&R Membership Shopping Warehouses, and 62 S&R New York Style QSRs.