Cosco Capital profit up 5%, revenues slip

RETAIL holding firm Cosco Capital, Inc. reported a 5% growth in its consolidated net income to P10.5 billion in 2021, a year when it said it was “undeterred” by its lower revenues.

Consolidated revenues went down by 1.6% to P174.4 billion from P177.3 billion in 2020.

In a statement on Tuesday, the company said it was “undeterred by the slight decline in consolidated revenues experienced, brought about by the continuing impact of the COVID-19 (coronavirus disease 2019) restriction.”

It added that its business segments went through the second year of the pandemic with the company benefiting from a better bottom line from “gross margin enhancements.”

Cosco cited “stronger suppliers supports, sustained strategic cost and expense management as well as the income tax savings from the implementation of the CREATE (Corporate Recovery and Tax Incentives for Enterprises Act) Law.”

In 2021, the group’s grocery retailing businesses, Puregold Price Club, Inc. and S&R Membership Shopping Club, contributed 63% to the total core net income.

The retailing segment was followed by liquor distribution with 23%, commercial real estate with 13% and specialty retailing, Office Warehouse, Inc., with 1%.

The grocery retail segment recorded a 1.4% growth in net income to P8.18 billion from the improvement in gross profit margins as well as strategic cost reduction measures.

However, consolidated revenues dropped by 2.7% to P164.1 billion, driven by a decline in customer traffic in its Puregold supermarkets over the pandemic.

“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 2 new S&R warehouse clubs in 2021,” Cosco said.

Its store network includes 430 Puregold stores, 22 S&R membership shopping warehouses, and 47 S&R New York Style quickservice restaurants.

Meanwhile, the liquor distribution business, through The Keepers Holdings, Inc., reported a 34.4% jump in net income to P1.58 billion, resulting from the strong sales performance and strategic cost control of its distribution, marketing and promotion expenses.

Consolidated revenues likewise rose by 35.1% to P11.03 billion, backed by a 31.9% growth in volume of cases sold.