Chinese grocer Lianhua Supermarket Holdings has booked a drop in profits for 2012 as lower sales and higher costs hit its bottom line.
The company said operating profit in the 12 months to the end of December fell 38.24% to CNY512m (US$82.3m). Net profit dropped from CNY713.7m in 2011 to CNY452.1m in 2012.
The group said costs in the period saw a “rigid up-trend”. However, the company was also hit by a decrease in like-for-like sales, which fell 0.7% as Chinese consumers reined in spending in response to the slowing economy. The drop was led by a 2.8% drop in hypermarket sales.
Overall, revenues increased by 5.3% to CNY28.99bn in the period as the company opened 394 new outlets.