Belo-led Wilcon Depot Inc., the country’s largest retailer of home improvement and construction supplies, saw its first-quarter profit climb 4.9 percent as the escalating conflict in the Middle East spurred customers to front-load purchases.

In a disclosure to the Philippine Stock Exchange, the firm reported a net income of ₱563 million for the first three months of 2026, with net sales rising 9.1 percent to ₱9.17 billion.

Lorraine Belo-Cincochan, Wilcon president and chief executive officer, said the sales performance exceeded internal targets, particularly in March.

She attributed the momentum to customers with active projects who accelerated their buying to avoid potential price hikes or supply shortages tied to rising global oil prices and Middle Eastern geopolitical instability.

The sales growth also marked the third consecutive quarter of positive same-store sales growth for the retailer. Beyond external market pressures, Belo-Cincochan credited the performance to internal operational upgrades.

These initiatives, aimed at enhancing customer service and merchandising, have led to higher conversion rates and larger average transaction sizes.

Despite the broader economic uncertainty, Wilcon is maintaining its expansion pace. The company opened three new depots in Luzon during the quarter and plans to complete five more locations before the end of the year. Wilcon indicated that these remaining stores are currently in various stages of construction.

Total revenue was bolstered by a 4.7 percent increase in comparable sales growth and the contribution of new store openings. The company’s primary depot format generated ₱8.83 billion, more than 96 percent of total sales.

Meanwhile, Wilcon’s smaller Home Essentials format, known as DIW stores, posted revenue growth of 10.4 percent to ₱285 million. Project-based sales, though a small fraction of the total, surged 62.9 percent to ₱56 million.

However, margins faced some compression during the quarter as gross profit rose four percent to ₱3.39 billion, but the blended gross profit margin narrowed to 37 percent. This contraction was driven by a faster growth rate in lower-margin non-exclusive products. Additionally, the sales contribution from the company’s higher-margin exclusive and in-house brands dipped to 51.7 percent.

Operating expenses, which include lease-related interest, increased 4.1 percent to ₱2.77 billion. The rise was largely due to higher depreciation costs associated with new store equipment and buildings, as well as increased spending on utilities, trucking, and outsourced services.

Belo-Cincochan said that while the Middle East situation remains a source of volatility that could disrupt growth, the company remains agile. The retailer intends to stay prudent in its capital management while navigating potential headwinds in the global supply chain. (James A. Loyola)