Wilcon Depot Inc., a leading home improvement and construction supplies retailer, said it plans to open 24 stores over the next four years.
Wilcon said in a disclosure to the stock exchange the company was also on the lookout for potential sites for expansion to accelerate the store rollout.
“We expect these new opportunities coupled with a steady growth tack from our existing stores to drive our growth momentum,” Wilcon chief finance officer Mark Andrew Belo said.
Wilcon posted a net income of P1.35 billion in 2017, up 56 percent from P886.8 million in 2016, which covered just three quarters of operations from April 1, 2016, when the retail business was transferred from parent Wilcon Corp.
Net sales in 2017 amounted to P17.75 billion, compared with P12.3 billion in 2016.
Belo said the strong results were driven by a consistent same-store sales growth of six percent and the opening of five new depots in 2017.
Belo said sales from these five stores already comprised 2.5 percent of total sales for the year, although four of the five new outlets just started operating in the second half.
The company’s flagship format, the depot, accounted for 97 percent, or P17.198 billion, while sales generated by the smaller home essentials format stores comprised the balance of 3.1 percent, or P550 million.
“We attained our target margin expansion for 2017 with a 29.7-percent gross profit margin primarily by increasing the contribution to total sales of our higher-margin products and more efficient sourcing process to achieve timely sales incentives and purchase discounts. Gross profit margin in 2016 including the first quarter operations was 27.4 percent,” Belo said.
“The improved gross profit margin more than made up for the rise in operating expenses, brought about mainly by the accumulation of front-loaded expenses associated with new store openings. Operating expenses as a percentage of sales settled at 20.3 percent in 2017 while in 2016 operating expenses as a percentage of sales for the nine months of commercial operations closed at 18.6 percent,” he said.
The company currently operates 37 depots and small format stores across the country.