TIDMDFI TIDMJAR
RNS Number : 3722D
Dairy Farm International Hldgs Ltd
02 March 2022
Announcement
2nd March 2022
PT HERO SUPERMARKET TBK
FULL YEAR 2021 RESULTS
The following announcement was issued today by the Company's
89.3%-owned subsidiary, PT Hero Supermarket Tbk.
For further information, please contact:
Dairy Farm Management Services Limited
Diky Risbianto ( 62 - 21 ) 8378 8388
South Tangerang, 2(nd) March 2022
PT HERO SUPERMARKET TBK
FULL YEAR 2021 RESULTS
Highlights
-- Home Furnishing, Health & Beauty and Grocery Retail
business materially affected by pandemic-related restrictions
-- IKEA opened three new stores, including its first store
outside Java, a Giant conversion in Bali
-- Successful execution of business transformation programmes enhanced business fundamentals
-- PT Hero remains well-positioned for growth over longer-term
Results
Audited Full Year
2021 2020 Change
-------------------
Rp billion Rp billion %
------------------- ---------------- ----------- ----------- -------
Net Revenue * 3,481 3,559 -2.2
Gross Profit * 1,517 1,776 -14.6
Loss for the year - Continuing (932) (519) -79.6
- Discontinued (32) (696) +95.4
- Total (964) (1,215) +20.7
Rp Rp %
Loss per share - Continuing (223) (124) -79.8
- Discontinued (7) (166) +95.8
- Total (230) (290) +20.7
------------------------------------ ----------- ----------- -------
* From continuing operations
PRESIDENT DIRECTOR'S STATEMENT
Introduction
The Company faced significant challenges in 2021 due to the
COVID-19 pandemic, the related imposition of PPKM (Enforcement of
Limitation on Community Activities), and consequent changes in
customer shopping habits. Government-imposed restrictions on
movement eased over the course of the second half, however, and
overall performance improved in the fourth quarter relative to the
third quarter.
In May 2021, the Company announced that, following a strategic
review, it would be pivoting its trading operations away from the
Giant banner by increasing investment in its strong brands of IKEA,
Guardian and Hero Supermarkets. This change in strategy is a
decisive and necessary response to changing market dynamics,
particularly given the move away from the hypermarket format by
Indonesian consumers in recent years. During the second half, the
Company successfully executed the restructure of Giant in
Indonesia. Six stores have been successfully converted to the Hero
Supermarket banner. In addition, IKEA opened its first store
outside Java, a Giant conversion in Bali.
Financial Performance
The Company reported a loss of Rp 964 billion in 2021, which
included Rp 32 billion of losses associated with discontinued
operations. A combination of net non-recurring charges incurred as
a result of the Giant restructure as well as additional tax related
expenses accounted for around 70% of the losses in the year.
IKEA's performance continued to be significantly impacted by
pandemic-related restrictions, resulting in over 130 equivalent
days of lost trade due to forced store closures, limitations on
store operating capacity and restrictions on dining. In addition,
global supply chain disruptions impacted stock availability during
the year. We believe, however, that the foundations have been laid
to support strong growth when the external environment
normalises.
IKEA's total network space in Indonesia has more than doubled
relative to the start of the year, following the opening of the
Bandung and Jakarta Garden City stores. In addition, in November,
IKEA opened its first store outside Java through the conversion of
a Giant store in Bali. This expansion follows IKEA's strategic
imperatives of being more accessible and affordable to the people
of Indonesia and we believe these stores will generate good returns
for our shareholders over time.
Guardian's performance continued to be significantly impacted by
pandemic-related restrictions in Indonesia and associated changes
in customer behaviours, particularly as traffic reduced in shopping
malls. Nevertheless, Guardian's like-for-like sales did improve in
the fourth quarter as restrictions eased. In addition, Guardian
continues to adapt to the changing external environment through
price reinvestment to drive additional value for customers, growth
in new formats and range optimisation tailored to specific customer
demographics.
The performance of Hero Supermarket stores in the year was also
affected by the imposition of pandemic-related restrictions and
changes in customer behaviours. Like-for-like sales, however, began
to improve in the fourth quarter with a progressive improvement in
customer traffic. Following the Giant restructure, six stores have
been converted to Hero Supermarket stores. Hero is also innovating
through range optimisation programmes and the rollout of new online
shopping initiatives.
Business Update
Following the change in PT Hero's strategic approach, the Giant
banner in Indonesia ceased operations in July. The Company has
successfully divested a number of stores to third parties and
remains in active discussions to dispose of several further stores.
In addition to stores already converted, several additional IKEA
conversions are also planned.
People
We would like to express our deep thanks and appreciation to all
our team members who have worked tirelessly to service our
customers during a challenging 2021 - without them nothing would be
possible.
Prospects
The duration and extent of the impact of the COVID-19 pandemic
on PT Hero remains uncertain. However, PT Hero is cautiously
optimistic that the external trading environment will improve in
2022, following improved performance over the course of the second
half of 2021. The Company remains committed to its retail future in
Indonesia. We believe that the successful execution of business
transformation programmes over the past few years have enhanced the
foundations of PT Hero and positioned the Company strongly for
growth in Indonesia over the long-term.
Patrik Lindvall
President Director
2(nd) March 2022
For further information contact:
Patrik Lindvall, President Director
PT Hero Supermarket Tbk
Tel: +62-21-8378 8388
E-mail: extcomm@hero.co.id
- end -
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