7-Eleven stores in HK, China, Spore post sales growth: Dairy Farm

BERMUDA: Dairy Farm International Holdings Ltd, which recorded a 10.6% jump in profit attributable to shareholders of the group for the year ended Dec 31, 2016, saw sales growth in the 7-Eleven convenience store businesses in Hong Kong, mainland China and Singapore and Hong Kong supermarkets help offset declines in the group’s supermarkets and hypermarkets in Singapore and Indonesia and largely flat sales elsewhere.

Dairy Farm operates in four segments: food, health and beauty, home furnishings and restaurants. The food division contributed about 72% of the group’s RM11.2 billion sales last year.

Dairy Farm operates hypermarkets, supermarkets and convenience stores under its food division. For the year, it saw growth of operating profit for convenience stores (14.6%) outpace that in the hypermarket and supermarket (12.8%).

Dairy Farm operates 7-Eleven stores in Hong Kong, Macau, Singapore and Guangdong Province in the convenience store segment; pharmacy chain Wellcome in Hong Kong, Taiwan and the Philippines, Yonghui in mainland China, Cold Storage in Singapore and Malaysia, Giant in Malaysia, Indonesia and Singapore and Hero in Indonesia under supermarkets; and Giant in Malaysia, Indonesia, Singapore, Brunei and Vietnam, and Yonghui in mainland China under hypermarkets.

Convenience stores reported US$2 billion (RM8.9 billion) in sales, an increase of 5% over the previous year in constant currency terms.

In Hong Kong, 7-Eleven outpaced the competition and grew sales and operating profit despite soft consumer sentiment and difficult market conditions. Like-for-like sales strengthened during the year supported by promotions, range improvements, including ready-to-eat (RTE) and new products.

In mainland China, 7-Eleven continued its solid growth and passed its 800th store milestone. During the year, sales and operating profit increased, with store network expansion and like-for-like sales growth. RTE sales growth combined with attractive consumer promotions supported this achievement.

In Singapore, 7-Eleven achieved positive like-for-like sales growth arising from a store re-ranging project with a strong focus on RTE products, including the successful introduction of new private label products sourced from 7-Eleven Japan. Operating profit was significantly ahead of 2015 due to these initiatives and the rationalisation of loss-making stores.