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Dairy Farm has released its results for the first quarter of 2019, with sales ahead of the same period last year.
The Group’s multi-year transformation plan for its Supermarkets and Hypermarkets business is underway, but CEO Ian Mcleod previously estimated it will take the company five years to complete its turnaround plan. Sales in North Asia were in line with last year, with sales growth in Hong Kong and Macau offset by weakness in Taiwan.
Sales in Southeast Asia were impacted by the launch of a store consolidation plan in the region. which aims to drive stronger profitability longer term.
Convenience store sales increased in all markets, but store network expansion impacted profits.
Sales and profits growth continued for the Health and Beauty business in North Asia. Southeast Asia also delivered a solid performance with encouraging sales and profits growth in the quarter, particularly in Malaysia and Indonesia.
Profitability in the Home Furnishings business was lower mainly due to the increased cost of goods compared with last year and the pre-opening costs for new IKEA stores under development.
Maxim’s and Yonghui delivered strong sales growth for the period and their like-for-like contributions were also ahead. The Group’s results also benefitted from its 20% stake in Robinsons Retail it acquired in November last year.
As Dairy Farm looks to reshape the Food business to achieve long-term sustainable growth, performance from key associates Maxim’s, Yonghui and Robinsons Retail will become even more important to support Dairy Farm’s top-line growth.
Asia subscribers can read more on Dairy Farm's Strategic Outlook here.
Dairy Farm FY18 results here.