MANILA, Philippines – Puregold Price Club Inc of retail tycoon Lucio Co will be spending P5.5 billion ($123.31 million*) in 2015 primarily for store expansion.
About 25 Puregold stores are for construction, totaling P5.5 billion ($123.31 million); two S&R stores, P1.5 billion ($33.63 million); and another P1.5 billion ($33.63 million) for acquisitions, Puregold president Leonardo Dayao said.
Puregold is in a very good position to grow since it is the only retail company that is focusing on the lower income segment of the market and is the only one focusing on sari-sari (retail) store, Dayao said.
Puregold’s S&R is the only membership shopping store in the country.
“So we are very optimistic over the prospects of the company in next year,” Dayao said.
Apart from growing the Puregold format, Dayao said the company is also accelerating the expansion of S&R stores by putting up two stores over 5 years, with spending of P500 million ($11.21 million) to P700 million ($15.69 million).
Most of the new S&R stores are located in Visayas and Mindanao.
For next year, the company is also looking at a possible site in Visayas, either in Bacolod or Iloilo, and another one in Southern Luzon –Batangas or Laguna – for S&R expansion, Dayao said.
The company, however, remains open for acquisitions to accelerate store expansion.
Duty free shops
Puregold’s plan to buy the Co family’s duty free shops in Clark and Subic has been moved to the middle of 2015.
The consolidation of Puregold Duty Free Clark and Puregold Duty Free Subic under Puregold will give the supermarket chain “full assortment and variety of formats to ensure customer satisfaction," the company said.
The two Duty Free stores are the remaining supermarket shops owned by the Co family and yet to be consolidated under Puregold.
Dayao said the company will no longer be able to finalize the agreement before end-2014, the original target date for completion.
While valuations are complete, Dayao said the company is still finalizing some details.
The deal will still be completed through a combination of cash payment and share swap.
The company said the consolidation of these two duty free stores, which generate P200 million ($4.48 million) in monthly sales, will contribute to Puregold’s earnings. – Rappler.com