Cosco posts P10.5-B profit (Sabong News)

Cosco Capital, Inc., the listed retail holding firm of Lucio L. Co, reported a 5 percent improvement in consolidated net income to P10.5 billion last year from P10 billion in 2020. In a disclosure to the Philippine Stock Exchange, the firm said its 2021 earnings is also 13 percent better than the pre-pandemic 2019 consolidated core net income of P9.3 billion. “The net income performance in 2021 was undeterred by the slight decline in consolidated revenues experienced in 2021 brought about by the continuing impact of the Covid-19 restrictions experienced for the most part of the year by the different business segments of the Group,” Cosco said. Consolidated revenues declined to P174.4 billion in 2021 from P177.3 billion in 2020. As the business segments navigated through the second year of the pandemic, the company said it continued to benefit by way of a better bottom line results from a combination of the gross margin enhancements thru stronger suppliers supports, sustained strategic cost and expense management as well as the income tax savings from the implementation of the CREATE Law. In 2021, the group’s grocery retailing businesses, Puregold Price Club, Inc. and S&R Membership Shopping Club, contributed 63 ercent of total core net income, followed by the Liquor Distribution with 23 percent, Commercial Real Estate segment with 13 percent, and the group’s Specialty Retailing segment, Office Warehouse, Inc., accounted for 1 percent. The grocery retail segment experienced a decline in its consolidated revenues by 2.7 percent to P164.1 billion mainly driven by a decline in customer traffic in its Puregold supermarkets due to continuing impact of the pandemic. But Puregold was able to manage a 1.4 percent growth in net income to P8.18 billion due to the improvement in gross profit margins as well as strategic cost reduction measures. Despite the prevailing environment, the grocery retail group continued to implement its organic expansion strategy and opened a total of 30 new Puregold stores and two new S&R warehouse clubs in 2021. The Liquor Distribution business thru The Keepers Holdings Inc. has recorded a historic consolidated revenue amounting to P11.03 billion, a 35.1 percent growth versus previous year on the back of a 31.9 percent growth in volume of cases sold totaling more than 4.46 million cases sold in 2021. Net income for the liquor segment jumped by 34.4 percent to an all-time high of P1.58 billion in 2021 resulting from the strong sales performance augmented by management’s strategic cost control of its distribution, marketing and promotion expenses. The Commercial Real Estate segment posted flat revenues amounting to P1.69 billion in 2021 as it continued to extend rental reliefs during the whole year 2021 against nine months period starting in the second quarter in 2020. However, the segment managed to improve its net income by 30 percent to P915 million in 2021 versus P700 million in 2020 due to a combination of strategic cost efficiencies in the management of its cost of services as well as operating expenses coupled by the lower provisions for income tax pursuant to the CREATE Law. For the Specialty Retailing business segment, Office Warehouse, Inc.’s revenues decreased by 6.9 percent to P1.56 billion as it continued to deal with the effects of hard lockdowns during the year. Net income declined to P50 million in 2021 from P56 million in 2020.