Parkson Retail annual results for the year ended 31 December 2019. In 2019, China has faced multiple fronts of downward pressure, which somewhat dampened the country’s consumption sector as well. During the Year under Review, the Group has achieved stable performance, by continuing to diversify its retail formats, focus on expanding certain specific consumption sectors and enhance product offerings. The Group recorded total gross sales proceeds of RMB14,181.2mn inclusive of value-added tax, a decline of 6.7% compared to last year, which was mainly due to the closure of underperforming stores in 2019 and the decline in same store sales. Total operating revenues of the Group increased by RMB178.2mn or 3.7% to RMB 5,026.0mn, profit from operations increased by 179.3% year-on-year to RMB474.5mn. Same store sales decreased by 3.9% in 2019.
Following a period of business transformation, Parkson is expanding its retail portfolio while flexibly applying various operating models and financial arrangements to strengthen the Group’s position as a leading lifestyle retailer in China. In June 2019, the Group secured the usage right of a property above Bayi Guan Station of the Rail Transit Line 1 in Nanchang City, Jiangxi Province, with a total gross area of 42,900m2. The new department store is located on the prosperous Zhongshan Road in the old city of Nanchang. The tactics of differential positioning along with close collaboration of the two stores have created synergies and attracted a wider customer group, allowing the Group more flexibility while leveraging on its diversified retail formats.
In terms of the department store business, the Group’s second department store in Datong, Shanxi Province, China is expected to open in the second quarter of 2020. It is expected that this retail space will be a “Complex of department stores and shopping centres”, which will further diversify the product mix within the facility. It also fits into the Group’s Differential Positioning tactics for “Multiple Stores in a City”, which aim to serve more customers with different spending habits.
In recent years, the Group has been actively exploring the beauty segment, ‘Parkson Beauty’, the Group’s beauty concept store, has been performing well and received positive response from customers. It has attracted various international beauty brands and created a brand-new beauty upgrading experience for consumers. Up to now, “Parkson Beauty” has set up three retail outlets in Changsha, Qingdao and Nanning, and has become a leading collection store of high-end beauty brands. In addition, the fast fashion segment has become another new business direction of the Group. In 2019, Parkson has launched its self-owned fast fashion brand “evry-D” and set up sales counters in five retail stores within a short period. With its unique brand concept and business model, “evry-D” has attracted the attention of consumers and the industry. Parkson Retail Group operates and manages 38 Parkson stores (including concept stores “Parkson Beauty”), 1 Lion Mall, 2 Parkson Newcore City Malls, supermarkets, fashion and food & beverage outlets, in 27 major cities across China.