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Results Note – Parkson (BUY, maintain) - FY06/12 net profit falls short due to Vietnam and China




Affin Hwang Investment Bank Bhd


09 Oct 2012





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Slightly below expectations PHB reported a full year FY06/12 revenue growth of +17.9% yoy to RM3,447.5m, boosted by: 1) revenue contribution from new store launches (China – 8, Malaysia – 2, Vietnam – 1, Indonesia – 2), and; 2) positive SSS growth (Malaysia: 9.2%, Indonesia: 9.3%, Vietnam: 9% and China: 6%). SSS growth in Vietnam and China was however weaker than the double digit growth recorded in FY06/11, due to an overall weaker macroeconomic environment. FY06/12 EBIT margin contracted by -3.6%-points yoy to 24.1% due to higher costs associated with new store launches from PRG’s aggressive expansion plans in China. Notwithstanding that, the strong revenue growth helped lift FY06/12 net profit by +7.9% yoy. Excluding a RM20.8m gain on disposal from the Yangzhou store in FY06/11, core net profit would have grown by a stronger +14.8% yoy to RM376.1m. Results were within consensus, but slightly below our expectations (94% of our full year net profit forecast). The variance was largely due to lower-than-expected margins from China and Vietnam.

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