DFI Retail Group swings into the black with US$8 million net profit in H1
Jessie Lim
DFI Retail Group returned to the black with a net profit of US$8 million for the first half of 2023, on contributions from its health and beauty division, as well as its convenience division.
The group had chalked up a net loss of US$58 million in the year-ago period. It said on Friday (Jul 28) that the recovery came amid improved trading conditions in Hong Kong and South-east Asia.
Earnings per share for the latest half-year came in at US$0.0061, compared to a loss per share of US$0.0425 in the corresponding period a year earlier.
The group’s total revenue, including that of its associates and joint ventures, fell 4 per cent to US$13.5 billion from US$14.1 billion previously. This came on the back of reduced sales at Yonghui, a grocery retailer it operates in mainland China.
In Singapore, DFI Retail, formerly known as Dairy Farm International, is known for its Cold Storage, Giant and Guardian stores.
The group’s health and beauty division reported over 20 per cent like-for-like sales growth in the first half compared with the year-ago period, it said. Guardian in particular reported strong underlying sales growth, especially in Malaysia and Indonesia.
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DFI Retail said: “While still below pre-pandemic levels, underlying profit more than doubled in the first half relative to the prior year, supported by a recovery in customer traffic, gross margin expansion and effective in-store execution despite pressure from labour shortages.”
Meanwhile, revenue for the group’s grocery retail division in H1 2023 was lower than the corresponding period a year earlier.
“In North Asia, sales in the prior year were supported by pantry-stocking during the fifth wave of Covid-19 in Hong Kong. South-east Asia grocery retail revenue was also lower, impacted by the divestment of the Malaysia grocery retail business and ongoing cautious customer sentiment driven by rising cost of living pressures,” the group said.
An interim dividend of US$0.03 per share was declared, and will be paid out on Oct 11.
Ben Keswick, chairman of DFI Retail, said the speed at which business performance returns to pre-pandemic levels will depend on the impact of economic conditions and the pace of recovery in consumer confidence. “We are confident that the group is well-positioned for growth in the remainder of the year and beyond,” he added.
DFI Retail will have a new group chief executive come Aug 1. Scott Price, who was formerly Asia chief executive officer of Walmart, will succeed incumbent Ian McLeod.
Shares of DFI Retail closed 0.7 per cent or US$0.02 lower at US$2.75 on Friday, before the results were released.
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