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China’s major hypermarket operator Sun Art Retail Group Ltd, set up by Auchan and Ruentex and backed up by Alibaba, reported a 7.3% fall in 2018 profit.
The retailer reported its net profit fell to RMB2.59bn (US$386m) from RMB2.79bn (US$386m). This was below the expected RMB2.70bn. Turnover fell by 2.9% to RMB99.36bn and same-store sales fell 1.72% year-on-year. The group’s gross profit margin increased by 1.2 percentage point from last year to 25.3%.
The company, operating under the “RT-Mart” and “Auchan” banners, says that the competition is fierce including online. "2018 was a year where the digitalization of our retail business began, and also a year to plan future development," the company said in a statement. "Through digital management, supply will be closely tied with demand to provide customers with the right product offering, good prices..."
Just one day after publishing its 2018 results, Sun Art announced plan to open 25 more stores in China this year, aiming to return to positive growth in 2019.
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