KUALA LUMPUR (May 30): Aeon Co (M) Bhd’s net profit grew 17% to RM32.64 million or 2.32 sen per share for the first quarter ended March 31, 2019 (1QFY19), from RM27.94 million or 1.99 sen per share a year earlier, amid higher retail revenue and margin.

Revenue for the quarter increased 8% to RM1.21 billion from RM1.11 billion, as contribution from its retail segment improved, buoyed by new stores which were opened in April 2018 and January 2019, as well as newly-renovated ones.

In its filing with the exchange, the group said its operating profit saw significant growth of 52% year-on-year to RM92.18 million, mainly due to impact of the Malaysian Financial Reporting Standards 16 (MFRS 16) accounting changes.

Consequently, its pre-tax profit increased 12% to RM55.7 million. However, after adjusting for the accounting changes and the inclusion of a share of operating loss from an associate, its pre-tax profit was still up 10% year-on-year, it said.

“The higher profit before tax was mainly due to higher retail revenue and margin,” the group said.

Aeon expects the challenging environment to persist for the remainder of FY19, noting concerns on higher cost of living, increased cost of doing business and the escalating global trade conflict.

“For the retail business, the company will continue to refurbish its selected stores and employ appropriate marketing and pricing strategies, merchandise assortment reformation, maintaining quality customer service and operational efficiency efforts to ensure that its core businesses will benefit,” it said.

Meanwhile, it expects occupancy and rental rates to remain challenging for the property management services division, and said it will continue to leverage on its competitive strengths to draw customer traffic to its malls.

Aeon closed 5 sen or 3.4% higher at RM1.52 today, giving it a market capitalisation of RM2.13 billion.