Consumer: PGOLD posts 46% earnings growth to PHP3.96b in 2013.
Puregold Price Club Inc (PGOLD – BUY) announced 2013 audited net income of PHP3.96b, up 46% and slightly ahead of our PHP3.7b estimate and PHP3.8b consensus. Implied 4Q13 earnings of PHP1.3b were higher 44%. 2013 net sales increased 27% to PHP73.2b, in line with our forecast. This implies 4Q13 topline growth of 18%, slightly improving from 3Q13's 16.5%.Higher revenues were driven by the opening of 40 new Puregold stores and two S&R stores during the year and acquisition of 15 Company E stores in 1Q13, bringing PGOLD’s total store network to 213 as of end-2013. 2013 gross profit margin improved 1.3pps to 17.4%, tracking our expectation. Net margin meanwhile increased 0.7pps to 5.4%, higher than initial indication and our estimate of 5.1%. We will be issuing a more detailed report but for now maintain our BUY rating.
-Maybank ATR
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