Parkson Retail Asia’s FY2023 net profit falls due to weak consumer spending—S$26.3M down 8.5%y-o-y

SINGAPORE: Department store operator Parkson Retail Asia has disclosed a dip in its net profit for the fiscal year 2023, ending on Dec 31, 2023.

The reported net profit stands at S$26.3 million, marking an 8.5% year-on-year decline from the previous fiscal year, The Edge Singapore reports.

The company’s profit before tax also experienced a downturn, falling to S$37.6 million compared to S$43.7 million recorded in the corresponding period.

This drop can be attributed to a lower store count throughout 2023 and a weak consumer spending power compared to figures from the previous year.

Earnings per share for the fiscal year 2023 were noted at 3.91 cents per share, decreasing from the 4.27 cents per share reported in the previous fiscal year.

In terms of revenue, Parkson Retail Asia witnessed a 4% year-on-year decline, with figures dropping to S$221.5 million from S$231 million in the same period of the preceding year.

Similarly, gross sales proceeds experienced a 9.1% year-on-year decrease, falling to S$535.7 million from S$589 million reported in the previous fiscal year.

According to the group, the decrease in total merchandise sales is also primarily due to a lower store count and weakened consumer spending power compared to the corresponding period.

However, amidst these declines, there are some notable highlights.

The company reported a 5.5% year-on-year increase in rental income, mainly driven by improved sales achieved by tenants.

Additionally, food and beverage operations saw a 6.2% year-on-year increase in sales, which Parkson attributes to consumers’ increased willingness to dine out following the recovery from the COVID-19 pandemic.

The merchandise gross profit margin stood at 27.7% for the fiscal year 2023.

As of Dec 31, 2023, Parkson Retail Asia’s department store network comprised 37 stores spanning approximately 409,000 square metres of gross floor area.

Notably, the group did not declare dividends, citing its position of “still being in accumulated losses.” /TISG

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