THAILAND: CP Seven Eleven Q1 sales up, but expansion costs hit profit
Thailand's largest convenience store company CP Seven Elevenhas reported a rise in total revenues for the first quarter of 2005, but net profits fell, because of costs caused by the expansion of its Lotus Supercenter business.
Total revenues for the first quarter were 24.298bn baht (US$609m), compared with 18.237bn in the same period a year ago. Net profit was 470m baht, compared with 528m in the year earlier period.
Net sales rose as a result of store expansion for 7-Eleven in Thailand and Lotus Supercenter in the People's Republic of China, the company said.
Lotus Supercenter, reported revenue growth of 43.5%, year on year. "Unfortunately, like-for-like growth was negative," the company said. "Aggressive expansion caused high expenses, both depreciation of fixed assets investment and operating expenses, while sales in new stores take time to catch up."
During the quarter the company added four Supercenters in Shanghai, Nanjing, Nantong and Chongqing.
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