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Tag: segment

  • DFI Retail Group Sees Robust Sales Boost Driven by Beauty and Health Segment Amid Global Challenges

    DFI Retail Group Sees Robust Sales Boost Driven by Beauty and Health Segment Amid Global Challenges

    The Hong Kong-based DFI Retail Group has recently announced a steady increase in sales for the first quarter of the year, primarily fueled by their health and beauty sector.

    Driving Growth with Health and Beauty

    Excluding cigarette sales, the DFI Retail Group reports a 4% sales rise on a year-on-year basis, using a constant currency, and a 3% increase on a like-for-like (LFL) basis. The health and beauty division is credited with a large part of this growth, with a 7% boost in LFL sales, thanks to increased transaction counts and larger basket sizes.

    In Hong Kong, Mannings saw notable growth due to a surge in tourist store sales, driven by an uptick in visitor arrivals. Similarly, Guardian’s sales in Southeast Asia reflected a robust performance in the wellness category. Standout growth was seen in Indonesia and Vietnam, which delivered double-digit LFL sales growth due to increased customer traffic.

    Divisional Performance and Growth

    Excluding cigarette sales, the convenience division, which includes 7-Eleven, saw a 2% growth on a LFL basis. Sales at 7-Eleven increased by 3% in both Hong Kong and Singapore, while sales in South China remained stable.

    The food division showed signs of improvement, with a reported 1% sales increase in Hong Kong. Home furnishings (Ikea) also showed positive trends, with a 4% growth. Both Hong Kong and Taiwan saw mid-single-digit LFL sales growth, owing to Chinese New Year promotions. Meanwhile, Indonesia bolstered its omnichannel strategy with robust online sales growth.

    Profit Growth Despite Market Challenges

    Operating profit from continuing businesses, excluding impacts from the divestment of the Singapore food business and the closure of Mannings China, grew by 12%. The underlying profit from ongoing businesses significantly increased by 49%.

    Despite a dynamic trading environment and increasing geopolitical uncertainties, DFI management stated the group remained resilient. This resilience was attributed to sourcing improvements and cost optimization, which supported price competitiveness and mitigated the impact of oil price volatility.

    DFI confirmed its full-year guidance of an underlying profit in the range of US$270 million to $300 million, supported by an organic revenue growth of approximately 2-3%.

    Questions & Answers

    What division drove the most growth for DFI Retail Group in the first quarter?
    The health and beauty division was the primary driver of growth in the first quarter, with a 7% increase in LFL sales.

    How did geopolitical uncertainties impact DFI Retail Group’s performance?
    Despite geopolitical uncertainties, DFI remained resilient due to sourcing improvements and cost optimization, which helped maintain price competitiveness and minimize the impact of oil price volatility.

    What is the projected full-year guidance for DFI’s underlying profit?
    DFI’s projected full-year guidance for underlying profit is in the range of US$270 million to $300 million, supported by an expected organic revenue growth of about 2-3%.

  • Coles Reports Robust Fiscal Year Results: Supermarket Sales Surge, E-commerce Thrives, Liquor Division Shows Moderate Growth

    Coles Reports Robust Fiscal Year Results: Supermarket Sales Surge, E-commerce Thrives, Liquor Division Shows Moderate Growth

    Coles has announced a 3.6% increase in group sales, reaching $44.3 billion, with an EBITDA rise of 11% to $3.9 billion for the current fiscal year. The group’s net profit after tax also increased, up by 2.4%, yielding a total of $1.07 billion.

    Driving Growth Through Supermarkets

    The company attributes much of its sales growth to its supermarket division, which showed a robust performance, growing by 4.3% and reaching $40 billion. The supermarket division’s EBITDA also rose by 9%, jumping from $2 billion to $2.1 billion. In addition, the division saw a rise in gross margin, from 26.6% to 27.4% on a year-on-year basis.

    This increase in supermarket sales revenue was bolstered by strong volume growth across transactions and basket sizes. Customers reacted positively to the company’s seasonal ‘Great Value, Hands Down’ value campaigns. Notably, the company had strong performance across several special occasions, such as Christmas, Easter, Halloween, and Mother’s Day. The success of collectible and continuity programs, such as the Curtis Stone Glassware and Harry Potter Magical Discs campaigns, played a significant role in bolstering Coles’ supermarket results for this financial year.

    Evolving E-commerce Performance

    Coles’ e-commerce sector within the supermarket division witnessed a rise of 24.4%, reaching $4.5 billion. The increase in penetration to 11.2% was driven by digital campaigns, Black Friday, Coles Fest, and the May Mega Sale.

    However, the group’s liquor division reported a slight increase of 1.1% in sales revenue, amounting to $3.6 billion, with a flat gross margin at 23.5%. The division’s EBITDA saw a decrease of 8.6%, falling from $133 million to $113 million on a year-on-year basis. Despite the decrease, Coles saw positive results in the liquor sales due to new store openings, a Tasmanian acquisition, and the curating of its wine category to meet local customer preferences.

    Liquorland and Future Plans

    Coles’ simplified ‘Simply Liquorland’ banner pilot was well-received in selected stores across South Australia, Victoria, and Queensland. The company plans to complete the ‘Simply Liquorland’ by the third quarter of the next fiscal year at a one-time cost of approximately $20 million. In addition, they plan to open about 19 new liquor stores, close 25 stores, and renew roughly 130 stores.

    Looking forward, Coles’ Chief Executive Officer, Leah Weckert, emphasized that the primary focus for the company will be on cost control and the delivery of the first full year of annualised benefits from its ADC program.

    Questions & Answers

    What drove the growth in Coles’ sales?
    The growth in Coles’ sales was largely driven by a strong performance in its supermarket division and positive customer response to its seasonal value campaigns.

    How did Coles’ e-commerce sector perform?
    Coles’ e-commerce sector within the supermarket division showed a significant rise of 24.4%, reaching $4.5 billion.

    What are the future plans for Coles’ ‘Simply Liquorland’?
    The ‘Simply Liquorland’ is planned to be completed by the third quarter of the next fiscal year, with approximately 19 new liquor stores being opened, 25 stores getting closed, and about 130 stores being renewed.

  • Harley-Davidson To Enter 250-500 cc Motorcycle Segment In 2020

    Harley-Davidson To Enter 250-500 cc Motorcycle Segment In 2020

    American motorcycle maker, Harley-Davidson has an expansive plan to enter newer segments in the years to come, one of which will be the entry-level 250-500 cc space that will arrive as early as next year. While the manufacturer has already shared plans of an adventure motorcycle, electric bike and other offerings, the latest development confirms that the company is also eyeing the entry-level premium motorcycle segment, which will give it a boost in emerging markets across the globe. The announcement comes Harley’s President & CEO – Matt Levatich, who confirmed the development as part of the “More Roads to Harley-Davidson” growth plan. The new small capacity motorcycles will cater to several high emerging growth markets including India.

    Speaking at the recently held earnings call, Matt Levatich said, “More Roads progress in Q1 included steps towards a partnership for a premium small displacement offering in Asia, to expand our reach in that region. We are just over a year away from launching our first model that will help provide access to millions of customers in emerging markets in the region.”

    It was a bold move when Harley-Davidson introduced the Street 750 and Street 500 globally as its most affordable offerings in 2013. The entry-level cruisers gave the manufacturer better presence in several emerging markets where the aspirational brand was now reachable. With the 250-500 cc segment, Harley will be taking on a number of players most important of which is Royal Enfield that currently rules this space in India.

    Globally too, the Chennai-based bike maker has been expanding its presence and has been vocal of its plans to lead the middleweight motorcycle segment. The new Interceptor 650 and the Continental GT 650 come close to the Harley Street range in pricing and displacement. In addition, there are also the offerings that will be spawned under the Triumph-Bajaj partnership which reportedly includes a small capacity Street Twin. BMW, KTM, Yamaha, and Honda are already present in this space.

    Smaller capacity offerings then certainly will be an exciting space in the years to come and offer a big room for Harley-Davidson to grow. The company’s smallest motorcycle globally is the Street 500, and the new 250-300 cc motorcycle could be a smaller Street badged bike. Expect to see Harley’s trademark V-Twin layout for the motor that will be Euro 5/BS6 compliant, with the motor high on torque. Expect it to look like the quintessential Harley in design, which is a big part of the sell for the buyer.

    Speaking of which, the smaller-capacity Harleys will be targeted at young buyers looking to establish a connection with the iconic brand, without spending too much money. It will also help the brand build volumes globally, which means standardized production for better economies of scale. More details on the new Harley will be available in the coming months and we do hope to hear something official at the Intermot or EICMA motorcycle shows later in the year.

  • Huawei says half of its flagships could have foldable displays by 2021

    Huawei says half of its flagships could have foldable displays by 2021

    Huawei is betting pretty heavily on foldable smartphones and in a recent interview the CEO of the company’s Consumer Business Group, Richard Yu, revealed Huawei’s short-term expectations for the new device format. Because the foldable segment is so new, Huawei’s primary focus at the moment is the recently-announced Mate X, which will go on sale in June. This device, as the company openly admits, is rather expensive but as foldable devices start to gain traction Huawei expects pricing to begin falling. In fact, in just two years’ time, Huawei’s foldable flagships should cost no more than regular smartphones.

    This gradual drop in price will also result in Huawei bringing more devices to the market and, by 2021, half of the smartphone giant’s flagship offerings could sport foldable displays, with one of these being a compact device that’s smaller than both the Huawei Mate X and Huawei P30 Pro.

    Obviously, foldable devices will become increasingly more important to Huawei in the years to come. The company does, however, recognize that not everyone will be interested in the new format and that some will prefer traditional smartphones. This would suggest that regular devices, like the ones in our hands today, will be sticking around for quite some time and are under no threat at the moment.