Hong Kong headquartered retailer Dairy Farm has posted solid full-year results in its 130th year of trade.
Underlying profit rose 7 per cent to US$460m, with operating profits up 6 per cent off the back of improvements in operating margins as well as strong results from Maxim’s and Yonghui.
Dairy Farms supermarket and hypermarkets division saw sales of US$6.2bn, with operating profits growing 13 per cent to US$194m.
“In an environment of severe pressure on pricing, sales growth in Hong Kong supermarkets and in the convenience store businesses in Hong Kong, mainland China and Singapore helped to offset declines in the Group’s supermarkets and hypermarkets in Singapore and Indonesia and largely flat sales elsewhere,” said Graham Allan, group chief executive. “The closure of a number of unprofitable stores in Singapore and Indonesia also weighed on sales performance.
“Despite the uncertain economic outlook for 2017, [Dairy Farm] continues to strengthen its businesses,” said Ben Keswick, Dairy Farm chairman. “Investments are being made to enhance its competitive position, increase customer convenience and adapt to emerging consumer trends. These investments, coupled with the exposure of its market-leading retail brands to Asia’s growth markets, will support Dairy Farm’s long-term success.”
Dairy Farm said it was “transforming itself to compete aggressively in a changing retail landscape”, focusing on understanding its customers, building digital engagement and investing in supply chain and IT infrastructure.
“Each business is committed to optimizing the shopping experience of its customers and to serving their evolving needs as efficiently as possible,” the group said in a statement released 2 March. “Increasing convenience through expansion and enhancement of the store network remains a high priority, although when necessary, underperforming stores will be closed.”
Dairy Farm operates 6,548 stores across 11 countries, with 487 Yonghui stores in China.