MANILA, Philippines — Philippine Seven Corporation (PSC), the exclusive licensor of 7-Eleven in the Philippines, is setting aside P3.5 billion in capital expenditures this year to fund expansion, officials said yesterday.
In a press conference yesterday before the company’s annual shareholders meeting, Jose Victor Paterno, PSC president and CEO, said the company is bullish on prospects for the year and is thus gearing for continued expansion.
PSC head of finance Lawrence de Leon said the company is targeting to have 800 new stores this year to bring its network to roughly 3,000 stores.
Bulk of the P3.5 billion would be used to fund new stores, while a portion would also be used to refurbish around 100 existing stores.
Last year, the company recorded a 16.2 percent net income increase driven by an 8.8 percent growth in same-store sales, the highest level in five years.
Paterno expects sales growth this year to be in the high single digit.
“As expected, the Tax Reform for Acceleration and Inclusion Law (TRAIN) was the biggest driver of sales growth in 2018. With lower personal income taxes, our customers’ disposable income and spending power increased. We’ve also increased our efforts to lessen the impact of higher prices of sugar-based products, leading to improved sales for these categories,” he said.
PSC chairman of the board and independent director Jose Pardo said that the company owes much of its success to customers who welcomed 7-Eleven stores as they expanded into new markets in the country.
“Over the past year, we’ve realized that serving the customers’ needs and giving them more reasons to visit the store leads to higher consumption. We will continue to roll out and be more aggressive in developing and scaling up our key programs – our freshly brewed coffee, City Blends, and our newly launched crispy fried chicken, Crunch Time.
These new brands aim to drive the frequency of customer visits and emphasize our value proposition of providing modern convenience,” Pardo said.
Last year PSC expanded its store network by 12 percent or additional 265 stores.
Thus, PSC ended 2018 with a total of 2,550 stores in the Philippines – 1,965 in Luzon, 938 of which are in Metro Manila.
Moving forward, Paterno said the company remains steadfast in strengthening its store network while ensuring that sites with the highest potential are acquired.