The Gaisano-Led Metro Retail Stores Group, Inc. (MRSGI) said its revenues increased in the first quarter of 2020 as supermarkets remained open and demand for basic goods and other essential products increased amid the lockdowns caused by the coronavirus disease 2019 (COVID-19) pandemic.
In a statement to the Philippine Stock Exchange on May 19, Metro Retail said it posted a P24.3 million increase in operating income in the first quarter.
Such growth was driven mainly by a 10 percent increase in revenue and a lower rate of increase in operating expenses at 4.6%.
Net sales for the period amounted to P8.49 billion, a 9.9% increase from P7.72 billion in the same period in 2019.
While general merchandise business declined by 10.6% because of the closure of its department stores in the later part of March due to the lockdowns, total food retail figures increased by 19%.
Gross margin percentage to sales decreased by 89 bps on account of higher share to business of food retail, slower department store sales, and compliance with government-imposed pricing protocols. Still, total margins for the period grew by 5.3%.
On the expense side, MRSGI said it incurred additional overhead costs for newly opened stores, including the Metro Ayala store in Cebu City which has partially reopened two years after it was razed by fire.
These additional costs were offset by the temporary closure of all department stores due to the lockdown in the second half of March in Metro Manila, resulting in the 4.6% decrease for the quarter.
Non-core income decreased by P97.4 million, mainly due to the last tranche of insurance recoveries which tapered to P104.4 million as against P190.5 million a year ago.
The results for the period also reflect the net impact of PFRS 16, which amounted to P20 million after tax, lower compared to the prior year.
Net income after tax for the period declined by P54.9 million or 87.3% versus the previous year.
As malls were allowed to reopen beginning May 16 in most parts of the country, MRSGI committed to “continue serving the interests of its customers, employees, shareholders and the general public and contributing to the economic recovery.
Regular disinfection of all touch points and high traffic areas in the stores before, during, and after operating hours have been rolled out, it said.
Only Cebu City and Mandaue City in Cebu remain under enhanced community quarantine (ECQ), which means malls are still not allowed to reopen except those establishments providing essential goods and services such as supermarkets, pharmacies and banks.
Metro supermarkets, hypermarkets and pharmacies are among those that remain open to ensure that shoppers have access to basic goods and essential items.
Metro Manila, Laguna, Bataan, Bulacan, Nueva Ecija, Pampanga including Angeles City, and Zambales have shifted to modified enhanced community quarantine (MECQ), under which malls are allowed to reopen at limited capacity.
The rest of the country is under general community quarantine (GCQ) and more businesses are allowed to reopen provided social distancing is observed and minimum health standards such as wearing of masks and installation of sanitation facilities are complied with.
MRSGI said Metro department stores will soon open in areas under GCQ and MECQ.
The company has also launched the first phase of its e-commerce program, which allows customers to order products via call, text, and online. (Ventures Cebu)