Wilcon Depot, Inc. Reported Q2 2024 Net Sales of P8.9 Billion, Up 2.9% YoY; H1 2024 Gross Profit of P6.8 billion, 39.8% GPM

Wilcon Depot, Inc., the Philippines’ leading home improvement and finishing construction supplies retailer, reported its second quarter net sales growth improved to P8.873 billion, a year-on-year increase of 2.9%, or P249 million, pulling up the first half 2024 net sales to P17.184 billion and approximately equaling the first half 2023 level of P17.152 billion.

The gross profit margin rate expanded to 39.8% for the first half from 39.5% in the same period in 2023 to bring the gross profit level to P6.839 billion by the end of the period. Net income for the first half of 2024 totaled P1.51 billion, lower by P307 million, or 16.9% year-on-year, due mainly to operating expense growth outpacing net sales growth.

​Wilcon’s President and CEO, Ms. Lorraine Belo-Cincochan, said that, “our second quarter performance improved over that of the first quarter’s to generate a net income of P770 million, while this was down 10% or P85 million year-on-year, there are one-off charges recognized this quarter of P98 million for inventory allowances and loss due to fire. The improved second quarter performance was partly due to the timing of the long holidays but we also rolled out programs focused on contractors and professionals and best deals promotions to increase turnover.”

We are looking forward to a better second half as we continue to push for higher sales while re-aligning resources deployed with the current market demand. We are continuing with our store network expansion program, opening five new stores for the first half and on track to reach our 100- store target by the end of the year”, Ms. Belo-Cincochan added.

1st Half 2024 Results Highlights

Net sales for the first half 2024, amounted to P17.184 billion, approximately equal to the first half 2023 level, up P32 million or 0.2% from the same period last year, driven mainly by sales from new stores offset by the decline in comparable sales of 4.6%. Five new stores were opened during the first-half, bringing to 95 the total number of branches by the end of the period.

On a per format basis, net sales from the depot-format stores, which comprised 95.8% of total net sales, were lower by P171 million or 1.0% year-on-year to total P16.469 billion. Sales from new depots increased the first half 2024 balance by 4.1%, however, comparable sales were 5.1% lower. The smaller Do-It-Wilcon (DIW) format, recorded net sales of P488 million, a P137 million or 39.1% increase year-on-year, contributed mainly by new DIW stores. Same store sales for this smaller store format declined by 3.1%. The remaining 1.3% of total net sales was accounted for by project sales or sales to major institutional accounts, which amounted to P227 million, with a P67 million or 41.5% year-on-year increase.

Gross profit margin rate expanded by 30 basis points to 39.8%, due mainly to product mix, resulting in gross profit of P6.839 billion, up 1.0% or P69 million year-on-year.

Operating expenses including lease-related interest expense increased by P400M or 8.6% to amount to P5.077 billion while operating other income totaled P244 million, lower by P69 million or 22.1% year-on-year. Non-operating net other income (charges) amounted to P2 million with the loss due to fire of P12 million recognized in the second quarter partly offsetting the P14 million interest income.

As a result, net income amounted to P1.510 billion, P308 million or 16.9% lower year-on-year.

2nd Quarter 2024 Results Highlights

Net sales for the quarter totaled P8.873 billion 2.9% or P249 million higher year-on-year. Comparable sales were still down 2.0% year-on-year but an improvement over the 7.3% decline in the first quarter. Two new depots were opened during the quarter.

Gross profit of P3.519 billion was up P112 million or 3.3% year-on-year, attributed mainly to higher sales and the expansion in gross profit margin from 39.5% to 39.7%. Operating expenses including lease-related interest expense totaled P2.605 billion, up P242 million or 10.2% year-on-year mainly traced to expansion-related expenses. Operating other income was P20 million or 21.1% higher year[1]on-year at P115 million in view of increased delivery fees from customers partly offset by the lower collection of rent and rebates and other support from suppliers. Non-operating other charges of P6 million included the recognition of loss due to fire of P12 million partly offset by interest income.

Net income totaled P770 million, P85 million or 10% lower year-on-year. Cash dividends of P1.019 billion were distributed in May 2024.