President Chain Store Corp (PCSC, 統一超商), which operates the nation’s largest convenience store chain, 7-Eleven, yesterday opened 10 stores in China’s Zhejiang Province, aiming to quickly expand its market presence in the Yangtze River Delta area.
The company’s top priority is to open more stores in Hangzhou and Ningbo, two of the most prosperous markets in the region, in a bid to increase the number of 7-Eleven stores in the province to 30 by the end of this year, PCSC said in a statement.
It also aims to raise the number of Shanghai outlets from 117 to 140 this year, the statement said.
The firm entered the Chinese market in 2009.
Its convenience store business there continued to improve last quarter, with losses decreasing 30 percent year-on-year to NT$26 million (US$860,357), HSBC Securities Taiwan Corp said in a note issued on Thursday.
“The break-even timeline could be one or two quarters ahead of our 2019 expectation,” HSBC analyst Jeremy Chen (陳建名) said.
PCSC’s latest outlet expansion came after the company announced its plan to sell its stake in a joint venture to operate Starbucks stores in eastern China.
Uni-President Enterprises Corp (統一企業) and PCSC — two major units of food and retail conglomerate Uni-President Group (統一集團) — last month announced they are to sell their respective stakes of 20 percent and 30 percent in President Starbucks Coffee Shanghai Corp (上海統一星巴克咖啡) to Starbucks Corp for NT$40.11 billion.
They are to also buy the remaining 50 percent stake in President Starbucks Coffee Corp (統一星巴克) in Taiwan from the US company for NT$5.42 billion.
Uni-President Group chairman Alex Lo (羅智先) said at a news conference last week that the group would try to create other income sources following its disposal of Shanghai Starbucks.
On Wednesday, PCSC said that net profit for the second quarter increased 7.8 percent year-on-year to NT$2.79 billion.
Yuanta Securities Investment Consulting Co (元大投顧) attributed the growth to improving performance of the company’s Chinese subsidiaries, led by Shanghai Starbucks.
Earnings contribution by Shanghai Starbucks surged 40.8 percent annually to NT$463 million, contributing nearly 15 percent of PCSC’s total profit for the quarter, Yuanta analyst Juliette Liu (劉珮昀) said in a note issued on Thursday.
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