Better operating profit from China narrows Parkson’s 2Q net loss

Better operating profit from China narrows Parkson’s 2Q net loss
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KUALA LUMPUR (Feb 24): Parkson Holdings Bhd has narrowed its net loss to RM28.27 million or 2.65 sen per share in the second quarter ended Dec 31, 2020 (2QFY21), from RM81.08 million or 7.6 sen per share last year, mainly thanks to better operating profits from its China operations.

This also marks the 11th consecutive loss-making quarter for the department store operator.

Quarterly revenue was down 11.1% to RM877.77 million, from RM987.41 million, according to a filing with Bursa Malaysia today.

In China, the retailer saw its operating profit tripled to RM104.93 million in 2QFY21, from RM34.96 million. Vietnam reported an operating profit of RM412,000, against an operating loss of RM2.12 million in 2QFY20.

For the cumulative six months ended Dec 31, its net loss also shrunk to RM50 million, from RM125.7 million last year, while revenue slipped 9.9% to RM1.69 billion, from RM1.87 billion.

On prospects, the group's retailing stores in the Southeast Asian region are anticipating challenges brought on by the prolonged Covid-19 pandemic and weak consumer sentiment in 3QFY21.

Parkson China, on the other hand, will benefit from higher consumer spending during the Chinese New Year festivities, the group said.

“In the interim, in order to grasp the opportunities brought by the market recovery in China, the group will further initiate a variety of operation modes to diversify income sources, establish online and offline sales channels, and promote long term and sustainable development for the group,” Parkson said.

Parkson’s shares closed 2.5 sen or 13.16% lower at 16.5 sen today, valuing the company at RM108.49 million.

Kathy Fong