Wilcon Depot, Inc. Reported P740 Million Net Income in Q12024, a Lower 23.1%

The country's leading retailer of finishing construction supplies and home improvement products, Wilcon Depot, Inc. (Wilcon), announced that its first-quarter 2024 net income of P740 million was P222 million lower than the same period last year, a 23.1% decrease. The long Easter holidays moved from April to March this year, which is the main reason for the dip in net sales in March. 

According to Wilcon’s President, Ms. Lorraine Belo-Cincochan, “our earnings for the first quarter may have declined 23% year-on-year, but it’s still higher than any quarter’s earnings prior to 2022. We are looking forward to better results in the future as we work towards improving our performance to reach or even beat our 2022 results. This quarter’s performance was driven primarily by the considerable year-on-year drop in March sales because of the Easter holidays falling in March this year and exacerbated by the fact that March last year was our highest grossing month. Our April year-on-year sales growth reversed the decline in March and we are hoping that our improving average daily sales will be sustained from here on.”

Ms. Belo-Cincochan added, “we are still on track to reach our 100-store target by the end of the year. We have opened three new stores during the quarter, two Do It Wilcon (DIW) format branches and one depot.”
​
The extended Easter holiday season falling in March this year rather than April last year contributed significantly to the low March 2024 sales of P8.31 billion, a 2.5% or P217 million year-over-year decrease in net sales. Net sales increased by 2.3% in the first two months of the current year. Comparable sales fell 7.3% for the quarter, but only by 2.6% from January to February.

During the quarter, two DIW-type stores—one in Mindanao and one in Luzon—as well as one depot were opened.

With the same store sales growth of -7.9%, the depots' P7.97 billion in net sales for the quarter represented 95.9% of total net sales, down 4.0% or P335 million year over year. Conversely, the DIW format stores, which accounted for 2.8% of total sales, saw a decline in same store sales of 10.9% but an overall sales gain of 37.2%, or P63 million, year over year to reach P232 million for the quarter. Metro Manila stores saw the greatest loss for both formats, and in the first quarter of 2023, they also saw the most gain in same-store sales. However, project sales climbed by 108.1%, or P55 million, to reach P105 million by the end of the quarter, making up the final 1.3% of total net sales.
​
Despite an increase in gross profit margin to 39.9% from 39.4% in the same period last year, gross profit also fell due to fewer sales, falling 1.3%, or P43 million, year over year to total P3.32 billion for the quarter. The higher margin in-house and exclusive brands' increased contribution from 50.4% to 52.6% of total sales is primarily responsible for the increase in the GPM rate. Operating costs, which include interest costs associated with leasing, increased 6.9%, or P158 million, on an annual basis to P2.472 billion. The primary cause of the increase is expansion-related costs like freight and depreciation. 

The P129 million operating other revenue saw a 40.9% decline, or P89 million, mostly due to lower supplier support and other payments. A supplier offered a one-time discount during the same time frame in 2023 in conjunction with a marketing effort.

In contrast, total other revenue dropped by 40.4%, or P92 million, to P137 million. This drop was mostly caused by a loss in interest income as well as a decline in supplier assistance.