By the end of the second quarter, Robinsons Retail reported a drop in earnings. The net income attributable to equity shareholders of the parent was at P946 million from April to June and it was 32.9% lower than the same period in the previous year or equivalent to P1.41 billion. On a year-to-date basis, the attributable net income fell 32.4% or from P2.622 billion last year, it came down to P1.773 billion this year. As an investor of Robinsons Retail, you must know the current status of the company in order for you to decide what should be your next move. Let me share with you the essential key points that made the net income of the firm slid.
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Along with the drop in earnings, Robinsons Retail also disclosed that in spite of higher sales recorded this quarter, the new accounting standard greatly affect its performance. The new standard, which is PRFRS 16 (Leases) was effective January 1, 2019, and it was reflected in the year-to-date results of the financials of the firm. With PFRS 16, a right-of-use asset is recognized and amortized over the term of the lease while the interest expense is incurred on the lease liability. The shift to the new accounting standard reduced the firm’s net income.
During the six-months period, interest expenses of the company rose to P1.2 billion, higher than the P55 million reported last year during the same period because of the non-cash interest expenses on the lease liability. Despite interest expenses soaring high, the firm said that these adjustments are taken as non-cash and will not affect the cash flow of the company. Meanwhile, the core net income excluding interest from bonds, unrealized forex gains/losses, equitized net earnings from the 40% share in Robinsons Bank, and non-recurring expenses fell by 30.3% to P927 million in the second quarter. Without considering the effect of PRFS 16, the core net income was down by 2.2% or P2.2 billion.
Robinsons Retail made a significant amount of revenues this quarter. The net sales stood at P39.861 billion or 26.5% higher than last year. This brings the net sales by 27.7% or P77.211 billion in the first half of the year. The same-store sales growth (SSSG) rose to 3.9% in a six-month period which came on top of the sales from the consolidation of Rustan Supercenters, Inc. and newly-opened stores. Rustans was acquired last November. SSSG measures the growth in existing stores of the company and since there has been a jump on its figures, it’s proof that Robinsons is not only getting its sales from the newly-opened stores.