Taiwan FamilyMart Co (全家便利商店), the nation’s second-largest convenience store chain, is expected to see sustained growth in the third quarter of this year, backed by fast growth in fresh-food business, Yuanta Securities Investment Consulting Co ( 元大投顧) said.
In the second quarter, the company saw its sales reach NT$15.3 billion (US$480.83 million), up 8.2 percent quarterly and 4 percent annually.
During the same period, FamilyMart’s earnings per share was NT$2.05, compared with NT$1.64 in the same period last year, company data showed.
Last quarter’s growth could be attributed to a remarkable growth in fresh-food products, the company said in a statement.
Same-store sales growth is expected to remain solid with further improvement in the third quarter, thanks to increased seasonality and sales of high-margin items, such as coffee and frozen drinks, Yuanta analyst Juliette Liu (劉珮昀) said in a note to investors on Wednesday last week.
The company’s revenue this year is estimated to increase 4.3 percent to NT$60.3 billion, Liu said, adding that FamilyMart would maintain its outlet expansion strategy.
The convenience store operator continues to expand its shops that supply products by a number of other partner retailers, including Great Tree Pharmacy (大樹連鎖藥局) and Tanhou (天和鮮物), to stimulate sales.
“We believe this strategy will help the company to differentiate its stores from its peers and sustain solid same-store growth,” Liu said in the note.
FamilyMart said that it expects to see growth momentum driven by its newly launched coffee and bread products for the rest of the year.
The company plans to spend NT$3.25 billion on capital expenditures this year, aiming to enhance its services, the company said.
Its self-owned grocery brand, FamilyMart Collection, is another sales catalyst, the company said.
Yuanta is also optimistic about the performance of the company in China for the rest of the year.
Despite a loss at the beginning of this year, the company’s China business is expected to be back on track as investments started to materialize in the second quarter, a Yuanta note said.
FamilyMart shares yesterday fell NT$1 to close at NT$224 in Taipei trading.
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