Revenue increased by 16.3% to approximately HK$2,305.9 million.
Gross profit increased by 22.4% to approximately HK$817.3 million.
Operating profit increased by 75.9% to approximately HK$248.9 million.
Profit attributable to owners of the Company increased by 83.1% to approximately HK$201.0 million, if excluding the government subsidies of approximately HK$18.0 million, core net profit increased by 66.7% YOY.
As at 31 March 2023, the Group operated a total of 154 chain retail stores, including 145 retail stores in Hong Kong, 7 retail stores in Macau and 2 retail stores in Mainland China.
Introduced China Merchants Hoi Tung Trading Company Limited, a wholly-owned subsidiary of China Merchants Group Limited, as major shareholder to fully accelerate deployment in the Greater Bay Area and overseas market.
Basic earnings per share was approximately 20.1 cents.
For the year ended 31 Mar
Gross profit margin
Profit attributable to owners of the Company
Profit attributable to owners of the Company (excluding government subsidies)
Basic earnings per share (HK cents)
HONG KONG SAR –
Media OutReach – 5 June 2023 –
Best Mart 360 Holdings Limited (“Best Mart 360” or the “Company”, together with its subsidiaries, the “Group”; stock code: 2360.HK), a leisure food retailer in Hong Kong, announced its annual results for the year ended 31 March 2023 (“Financial Year under Review”). During the Financial Year under Review, the revenue recorded by the Group amounted to approximately HK$2,305,907,000, representing an increase of approximately 16.3%. During the Year, the Group recorded a 2.5% growth in same store sales performance (2022: approximately 7.3% increase). Such decrease in growth mainly attributable to the high base of the financial year ended 31 March 2022.
During the Financial Year under Review, gross profit for the year ended 31 March 2023 was approximately HK$817,263,000 (2022: approximately HK$667,654,000). Gross profit margin of the Group was approximately 35.4% (2022: approximately 33.7%). The increases in gross profit margin depends on the Group’s efforts to optimize product structure and effectively adjust sales and marketing strategies.
Profit attributable to owners of the Company was approximately HK$200,997,000 (2022: approximately HK$109,804,000), representing a significant increase of approximately 83.1%, if excluding the government subsidies of approximately HK$17,996,000, core net profit increased by approximately 66.7%.
During the Financial Year under review, basic earnings per share was 20.1 cents (2022: 11.0 cents).
26 new retail stores & increase footprint in residential areas
As at 31 March 2023, the Group operated a total of 154 chain retail stores (31 March 2022: 138 stores), comprising 150 “Best Mart 360˚” stores and four “FoodVille” stores (31 March 2022: 135 stores and three stores, respectively). In terms of geographical coverage, as at 31 March 2023, the Group operated 145 stores, seven stores and two stores in Hong Kong, Macau and Mainland China, respectively (31 March 2022: 130 stores, six stores and two stores, respectively). During the Financial Year under Review, the Group opened 26 new retail stores (including 25 in Hong Kong, one in Macau), and closed 10 stores upon expiration of their respective lease terms in line with the adjustment in the Group’s store opening strategy.
Rental expense (cash basis) for retail stores was approximately HK$220,230,000 for the year ended 31 March 2023, representing an increase of approximately 3.8% as compared with approximately HK$212,136,000 for the financial year ended 31 March 2022. The ratio of rental expense of retail stores to sales revenue was approximately 9.6%, which was lower than that of approximately 10.7% for the financial year ended 31 March 2022.
Kept optimising product mix & enhancing the development of private label products
During the Financial Year under Review, the Group continued its global procurement policy and mission by sourcing a broad spectrum of products worldwide to meet and satisfy market trend and demand. To better cater to the needs of the local community and the internationally travellers, in addition to further strengthening the supply of basic foodstuffs such as cereals, noodles, canned food, milk, frozen and chilled food, daily necessities and basic groceries, the Group also continued to enhance the sale of its private labels in retail stores, including nuts and dried fruits, organic cereals, wet tissues, canned food, biscuit and snacks and other products, offering consumers a more diversified range of selections.
For the Financial Year under Review, the Group procured quality products from overseas suppliers and brand owners or importers in Hong Kong and sold a total of about 3,770 SKUs of products (for the financial year ended 31 March 2022: about 3,560 SKUs) to all over the world, with product origins mainly from, among others, Japan and Korea, the United States, Europe and Australia, Vietnam and Thailand, as well as other Asia-Pacific countries. The Group sourced the most popular and trendy food products from every country or region to offer a globally-diversified, multi-brand and multi-category selection for every customer.
During the Financial Year under Review, the Group continued to actively develop private label products that allowed the Group to capture the pricing opportunities and exercise higher level of quality control on its products and on the other hand further uplifted the Group’s brand awareness and strengthened customers’ loyalty. During the Financial Year under Review, the revenue derived from private label products was recorded approximately HK$346,352,000, representing an increase of approximately 7.0% as compared with the year ended 31 March 2022.
Expanded the customer base & Strengthened marketing strategy
In order to further deepen customer stickiness and expand customers’ coverage, the Group used big data analysis and reformulated its marketing strategy to launch a new three-tier membership scheme and a second-generation mobile app in 2020. The new membership scheme helps to elevate brand positioning and market recognition, and the membership rewards have been fully optimised and enhanced, with more member benefits such as multiple items purchase stamp reward, special offers for selected products and access to latest market information. Through diversified marketing strategies, the Group aims to internally strengthen the membership core from within and attract new customers through external expansion, so as to effectively and purposefully foster the ties between members and the Group, thereby driving recurring business from members and promoting sustainable growth of the Group’s business.
During the Financial Year under Review, the number of the Group’s members increased from 1,861,245 as at 31 March 2022 to 2,059,688 as at 31 March 2023, representing an increase of approximately 10.7%. Since the launch of the mobile app in 2019, approximately 896,000 people have registered as members through the Group’s mobile app as of 31 March 2023.
Meanwhile, for the purpose of strengthening its marketing strategy and enhancing brand awareness, the Group has conducted various marketing and promotional activities to enhance the brand’s exposure in the market during the Financial Year under Review. These marketing initiatives included: (i) partnering with various e-payment platforms to offer electronic coupons to customers during the disbursement period of the government’s consumption vouchers; (ii) launching “Money-saving Tips”, under which customers will be entitled to a cash coupon for every purchase exceeding certain amount; (iii) collaborating with Berndes, a century-old German premium cookware brand, in the roll-out of an exclusive redemption programme; (iv) conducting live broadcasts by working with various television artists and “KOLs” and placing advertisements across different media channels, including television, newspaper and social media platform; and (v) collaborating with nutritionist to promote a healthy image and related healthy products. Through these efforts, the Group successfully generated recurring businesses and attracted new customers to garner a significant volume of consumer buzz for the Group in the market.
Other Business Development
Developing E-commerce in Mainland China
The Group has officially started the pilot e-commerce business in Mainland China in January 2023, allowing customers to shop online through a WeChat mini-app, with delivery service covering a radius of 3 km from the store location. The Group will proactively explore market trends and adjust product categories in an effort to improve the business model of e-commerce and increase sales.
Introducing CMHT as a Major Shareholder
As disclosed in the announcement of the Company dated 27 March 2023, Mr. Lin Tsz Fung (“Mr. Lin”) and Ms. Hui Ngai Fan (“Ms. Hui”), the controlling shareholders of the Group, had entered into a formal Sale and Purchase Agreement (“S&P Agreement”) with China Merchants Hoi Tung Trading Company Limited (the “CMHT”), in relation to the sale and purchase of the Company’s Shares (the “Shares”). Pursuant to the S&P Agreement, CMHT will purchase 490,000,000 Shares in aggregate, representing 49% of the total issued Shares. The total consideration for the sale Shares is HK$862,400,000, equivalent to HK$1.76 per sale share.
Upon completion, Mr. Lin and Ms. Hui, through entities wholly owned by them, will each continue to hold their retained shares respectively, representing in aggregate 26% of the total issued Shares.
The Group will continue to adopt dual-brand strategy and consistently look for suitable opportunities to expand the store network of its major retail brand “Best Mart 360˚ (優品360˚ )” and global gourmet store “FoodVille” in Hong Kong, Macau and Mainland China, with a target of achieving a net increase of 20 retail stores each year to satisfy the demand of different customer segments for quality food products. The “Best Mart 360˚ (優品360˚ )” brand will focus on serving the residential areas and expanding the coverage of its store network, while “FoodVille” will target large and medium-to-high-end shopping malls in Hong Kong as well as stores with larger area and locations with higher customer traffic and stronger consumer spending power. In addition to the ongoing internal enhancement to optimize product display space and provide a more comfortable shopping environment for customers, the Group will endeavor to increase the number of exclusive products of “FoodVille” and actively look for medium-to-high-end diversified quality products around the world so as to further differentiate the two brands.
To adhere to the mission of providing products with “Best Quality and “Best Prices”, the Group is committed to strengthen the core competitiveness of its brand. The Group will continue to source a diversified range of food products worldwide, as well as to step up the development of its private label products, which can satisfy market demand for daily necessities, enrich the choices for customers and effectively control product quality. Also, the Group will actively identify upstream suppliers to secure a lower procurement cost so as to maintain its competitive advantages in pricing.
In the view of expanding the Group’s potential customer base and generate more steady streams of revenue to maintain the profitability, the Group will further develop its business-to-business (B2B) segment by bulk selling its private label products and other imported products to other retailers, merchants, enterprises or even online stores in Hong Kong and overseas markets.
In addition, the Group will fully accelerate its expansion in the Greater Bay Area, exploring the development of a business model with both direct stores and franchisees to achieve the goal of a nationwide physical store. Regarding CMHT, an extensive trading company covering food and commodities, the Board believes that great business synergy with our major shareholder in B2B area and the development of the Greater Bay Area could be created
Mr. Hui Chi Kwan, Chief Executive Officer of the Group, said, “Hong Kong has gradually resumed the normal travel with other regions which accelerated the recovery of the local economy. The Group had quickly adjusted its business strategies, resulting in a strong growth for both sales and profit of the Group. During the year, we welcomed CMHT as a major shareholder to facilitate sustained growth and maximise synergies, particularly the development in Mainland China and internationally. Looking ahead, we will continue to adopt a dual-brand strategy to satisfy the needs of different customer segments. In addition to persist in adopting global procurement strategy and optimizing the product mix, we will fully promote the development plan in Greater Bay Area with the strategic support and crucial resources from CMHT, including expanding the local physical sales network and proactively exploring an e-commerce pilot.”
Hashtag: #BestMart360 #優品360
The issuer is solely responsible for the content of this announcement.