DFI Retail Group has reported an underlying profit which declined 18% y-o-y for 1QFY2025 ended March 31, following the divestment of Yonghui which contributed US$23 million in earnings the prior year.
Including Yonghui, underlying profit increased 28% y-o-y in 1QFY2025.
The group says that for the quarter, underlying subsidiary sales, excluding the impact of cigarette tax and the divestment of Hero Supermarket in Indonesia, was 1% y-o-y lower.
Strong sales in its Health and Beauty segment was offset by lower contributions from other divisions. Within its home market of Hong Kong, the group saw reported and LFL sales down by approximately 2% y-o-y or stable when excluding the impact of cigarette tax.
In February, the group completed the divestment of Yonghui, with net proceeds redeployed in a US$617 million debt payment resulting in a net cash position of US$127 million as at end March, compared to a US$468 million net debt position as at Dec 31, 2024.
In its various subsidiaries, like-for-like (LFL) sales in the Health and Beauty division for 1QFY2025 was up 4% y-o-y with all operating markets reporting positive LFL sales growth.
LFL sales for the Convenience division declined 6% y-o-y due to lower cigarette sales following a tax increase in Hong Kong beginning late February 2024.
See also: The Hour Glass Group’s earnings down 13% y-o-y to $135.8 mil despite y-o-y revenue growth
Despite a favourable sales mix shift towards higher-margin ready-to-eat products, profit for the division declined y-o-y due to lower reported sales as a result of cigarette tax impact.
The group’s division reported marginally lower LFL sales for the 1QFY2025, and saw a “significant recovery” in underlying profit for its Home Furnishing division.
In its associates, Maxim’s, the group’s 50% owned associate, reported stable y-o-y sale growth in Southeast Asia offset by weaker restaurant performance in China and store closures in Hong Kong.
Robinsons Retail reported 3% LFL sales growth, but reported profit dropped 85% y-o-y due to a one-time gain from the Bank of the Philippine Island and Robinsons Bank merger booked early last year.
The group announced that it entered a definitive agreement with Macrovalue to divestment its Singapore Food business, which includes the Cold Storage, CS Fresh, Jason’s Deli and Giant brands, for a total cash consideration of $125 million or approximately US$93 million, subject to adjustments.
The group maintains its full-year guidance of underlying profit attributable to shareholders between US$230 million and US$270 million, supported by an organic revenue growth of approximately 2%.
Shares in DFI Retail Groupclosed 4 cents lower or 1.465% down at $2.69 on May 19.
