7-Eleven operator’s 9-month income slips to P696M
Credit to Author: Tyrone Jasper C. Piad| Date: Fri, 15 Nov 2019 12:00:38 +0000
THE local operator of convenience-store chain 7-Eleven saw its net income in the first three quarters of 2019 drop to P695.9 million on account of the implementation of new accounting standards.
In a disclosure on Friday, Philippine Seven Corp. said the amount was a 5.4-percent decrease from P735.3 million in the same period last year.
It explained that the new standard mandated lessees to “to recognize an asset on the right to use the leased property (the right-of-use asset) and a liability on the obligation to make lease payments (the lease liability),” which came with the recognition of depreciation expense as well over the life of the lease and interest expense.
Despite the dip, Philippine Seven’s system-wide sales climbed by 22.7 percent to P40.6 billion in the January-to-September period from P33.1 billion the previous year on the back of a 10.19-percent growth in same-store sales and an 11.6-percent increase in the number of operating stores.
As of end-September, Philippine Seven has 2,726 stores, most of which are in Metro Manila. More than half — 55 percent — of these are franchised, while the remaining are company-owned.
“Service revenues more than doubled mainly due to growth in e-wallets cash-in and bills payment transactions,” Philippine Seven President and Chief Executive Officer Jose Victor Paterno said.
“Payments and services are an important source of traffic and revenue in other major convenience chains. This is an integral part of our CLIQQ digital ecosystem strategy, which also includes loyalty, e-wallet and e-commerce,” he added.
Operating income leaped by 51.5 percent to P1.65 billion, while earnings before interest, tax, depreciation and amortization surged by 74.3 percent to P4.42 billion.