12 February 2012
The Weekly

Robinson expects to achieve SSSG of 5-6% in 4Q11 and finish 2011 with SSSG of 11-12% and total sales growth of 20%. Though the floods have resulted in the temporary closure of five stores, the remaining 20 are doing well. In 4Q11, gross margin is expected to rise by 50 bps YoY on the back of a higher contribution from in-house brands (up to 8% from 7% in 4Q10), fewer promotion days and more outlets, which has led to Robinson attaining greater discounts from suppliers. A gross margin of 24.8%, up from 24.4% in 4Q10 and 24.3% in 3Q11 are forecasted. The only concern for 4Q11 is the performance of its subsidiaries, Power Buy and Siam Sport. Two of Power Buy's distribution centres have been inundated and it may need to book a loss on inventory; however, Power Buy is likely to regain the loss from insurance coverage within 4Q11. Robinsons is expected to report 4Q11 net profit of Bt389m, up 4.5% QoQ but down 6.1% YoY, mainly as a result of higher SG&A expenses due to TV advertising after the opening of Rama IX (the campaign is expected to cost at least Bt60m). Based on this 4Q11 earnings estimate, FY2011 normalized profit would be Bt1,536m, up 22% YoY and 3.6% above FY2011E normalized profit of Bt1,483m.