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Tag: Parkson Holdings Bhd

  • Odel to build Mega Mall in 3 years

    Odel to build Mega Mall in 3 years

    Sri Lanka’s Odel PLC (Odel) is aiming at upgrading its Ward Place Odel flagship store to improve quality of offerings to customers and plans to build a Mega Mall of 300,000 sq. feet adjoining the Odel flagship store along with car park amenities. Addressing shareholders at the release of the 2014 Annual Report, Chairman of Odel PLC (Odel), Ashok Pathirage said the Mall is projected to be completed within three years.

    “We intend to bring our Softlogic Brands portfolio to Odel. During the year, ‘Mothercare’ has already been promoted inside Odel stores. We continue to develop customer care to enhance and facilitate standards and to bring our retail store floor space to international standards. We will be also launching Bodyshop branded products at Odel in the Q3 of FY2015/2016,” Pathirage said.

    He noted that whilst the company serves customers through 20 stores, their new Business Model aims at smaller outlets and one Big Mall.

    “Thus, we have closed down some of our bigger outlets including Maharagama and Jaela, with other outlets currently under evaluation,” Pathirage said.

    Softlogic Holdings Plc initially acquired nearly a 45% stake in Odel for over Rs.2.7 billion and since then has gradually increased its stake to 93% of issued share capital of the company by acquiring a further 47.46% stake for over Rs.2.8 billion from Parkson Retail Asia Ltd (PRA), the Singapore-listed department store subsidiary of Parkson Holdings Bhd. The total investment in acquisition that was concluded in mid-September 2014 amounted to over Rs.5.5 billion.

    Odel acquired 99.99% of Softlogic Brands Private Ltd on 20th March 2015 for a total consideration of over Rs. 599.99 million from Softlogic Retail Pvt Ltd and Dai Nishi Securities, which are subsidiaries of Softlogic Holdings PLC.

    Analysts have outlined that the retail sales worldwide will reach US $22.492 trillion this year, and that the global retail market will see steady growth over the next few years. In 2018, worldwide retail sales are projected to increase by 5.5% to reach US $ 28.3 trillion.

    “We will continue to invest in the businesses that give us profitable returns and opportunities for capital appreciation over the next 3 – 5 years. Softlogic’s Retail operations have plans to increase island-wide expansion of retail space and our brand acquisitions are backed by careful assessments. Softlogic Retail has ambitious plans to target a total retail space of 335,000sq.ft. in three years,” Chairman Pathirage said.

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  • Parkson’s shares hit 9 ½-year low after sinking into red

    Parkson’s shares hit 9 ½-year low after sinking into red

    Parkson Holdings Bhd’s share price contracted as much as 7.14% to its nine-and-half-year low in the morning trade, making it one of the top losers across the bourse, after the department store operator sank into losses in its latest quarterly results.

    At 2.41pm, Parkson rebounded a little from its intra-day low (RM1.04) to trade at RM1.06, still down six sen or 5.36%, after some 571,800 shares changed hands.

    The current price gives Parkson a market capitalisation of RM1.16 billion.

    In its fourth quarter ended June 30 (4QFY15), Parkson posted a net loss of RM90.95 million or 8.75 sen per share, compared with a net profit of RM26.76 million or 2.56 sen per share last year, largely on weaker retail sentiments.
    This is despite revenue for 4QFY15 rising 5.2% to RM859.04 million, from RM816.51 million last year, mainly due to slightly better figures from China, Vietnam, Myanmar and Indonesia.

    The group’s retailing division registered a weaker set of results for FY15, with revenue increasing only by 4% to RM3.64 billion; while operating profit contracted by 41% to RM190 million, compared with FY14.

    Parkson said its operation in Malaysia saw same-store sales contracting 4.5% for FY15, as consumer sentiments were affected by rising cost of living and the depreciating ringgit.

    For the full year, Parkson’s net profit plunged 69% to RM42.84 million or 4.06 sen per share, against RM138.15 million or 13 sen per share in FY14; while revenue rose 5.4% to RM3.74 billion, against RM3.55 billion last year.

    Despite the lower earnings, Public Investment Bank has upgraded Parkson to ‘outperform’, as it views its weak share price as an opportunity to accumulate, but lowered its target price to RM1.48.

    “We believe the recent slump in share price has deemed Parkson attractive, considering there is still growth in sales and profits going forward, assuming no one-offs incurred,” said the investment bank.

    “We think further weakness in Parkson’s share price is not justified, as the group’s fundamentals remain intact, with more than RM2.7 billion cash and undemanding valuation of 10.6 times and 10 times of financial year 2016 (FY16) and financial year 2017 (FY17) respectively,” it added.

    Additionally, PIVB said the recent announcement of 10 sen per share cash distribution, which will come after its internal reorganisation is completed, is fairly rewarding to shareholders, yielding 8.9% of its current share price

     

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