Upson net income down 14% in 2023

UPSON International Corp. saw its net income last year drop by 13.7 percent to P464.2 million from P537.9 million in 2022 due to lower gross margins and preopening expenses.

Consolidated revenues, on the other hand, inched up by 5.8 percent year on year to P10 billion, thanks to contributions from new stores and a marginal increase in sales from existing outlets.

“For the first time in our history, revenues surpassed P10 billion as we increasingly reap the benefits from our expanding footprint,” Upson Chief Executive Officer Arlene Sy said in a statement on Monday.

“This strong foundation is what we will build on this year. Our focus is on serving our customers better to unlock the full potential of the new stores and deliver sustainable and profitable growth,” she added.

The IT retailer said computers, led by mid-range laptops, had driven revenue growth in 2023, along with printing and communication products, but this was partly offset by a sales drop in storage and components.

Geographically, markets remained relatively stable, with the Visayas experiencing the fastest growth, followed by Northern Mindanao, the company noted.

The cost of inventories sold, meanwhile, increased by 8.9 percent to P7.9 billion, resulting in a lower gross margin of 20.8 percent compared to 2022’s 23 percent. This was attributed to the revenue mix and decreased product margin rates.

Operating expenses also widened, by 9.5 percent year on year to P1.7 billion, owing to expansion-related costs, including lease payments, contracted services, depreciation, amortization, and manpower.

Upson launched 25 new stores last year, 12 of which were in the fourth quarter, bringing its total store count to 232 by year-end.

It also unveiled 12 technology brands and started setting up Apple corners in select outlets to provide customers with access to the brand. Its portfolio now includes 115 tech brands.

On Monday, the company declared a cash dividend of 6 centavos per share, for a total of P187.5 million, a 36 percent increase from 2022.