Grand Ocean aims to boost profitability

By Amy Su  /  Staff reporter

Tue, Apr 01, 2014 - Page 13

Grand Ocean Retail Group Ltd (大洋百貨集團), which operates 16 department stores in Chinese second-tier and third-tier cities, aims to strengthen its profitability this year by increasing its management income and licensing fees.

The company yesterday said it is ready to open its first licensed outlet in Xianning, Hubei Province this month, after its management team began operation there earlier last month.

“The company is set to sign a management contract with three to five department store owners by the end of this year,” Grand Ocean president Xu Zhi-yong (徐智勇) told a media briefing in Taipei yesterday before an investors’ conference.

LOCATIONS

These department stores will be located where Grand Ocean has already set up operations, including east, central and south China, Xu said.

Through the new business model, Grand Ocean would earn management income and license fees of 4 million yuan to 6 million yuan (US$643,000 to US$965,000) per outlet annually, while collecting certain premium bonuses accordingly.

The company has formed a joint venture with a real-estate company in China to develop a plot of land in Shiyan, Hubei Province, with the planned department store set to launch operations next year, Xu said.

In addition, the company has formed a joint venture with real-estate company in China to develop a land plot in Shiyan, Hubei Province, with the department store in the project set to launch official operation next year, he said.

Last year, the company post net income of NT$989.73 million (US$32.44 million), or NT$4.94 per share, up 36.7 percent from NT$723.96 million, or NT$3.71 per share, recorded in 2012, thanks to the company’s efforts in store adjustment and shutting down three loss-making outlets.