KUALA LUMPUR (May 25): 7-Eleven Malaysia Holdings Bhd’s (SEM) net profit fell 35.69% to RM15.68 million in the first quarter ended March 31, 2023 (1QFY2023) against RM24.38 million in the same quarter a year earlier (1QFY2022) due to lower profit from its pharmaceutical segment.

However, the dip in earnings was less drastic compared with the sharp 95% contraction in year-on-year earnings during the fourth quarter ended Dec 31, 2022 (4QFY2022), when its net profit plunged to RM2.65 million from RM29.44 million a year earlier (4QFY2021).

Its pharmaceutical arm Caring Pharmacy Group Bhd reported a drop in its gross profit margin to 19.4% in 1QFY2023 from 21.6% as sales of Covid-related items which carried higher product margins declined.

This was on top of lower sales productivity of newly acquired stores during the refurbishment and rebranding period, said the company in its Bursa filing on Thursday (May 25).

Its earnings per share fell to 1.41 sen from 2.16 sen.

For its quarter-to-quarter, however, its net profit more than doubled from RM2.65 million in the preceding quarter (4QFY2022) due to lower staff-related costs and information technology (IT) maintenance expenses in the current quarter.

However, revenue for 1QFY2023 rose by 16.30% to RM976.92 million compared to RM839.98 million in 1QFY2023 on better performance by its convenience store segment.

It contributed RM655.98 million in revenue versus RM523.92 million on the back of higher average per store day (APSD) and customer count as consumer spending and trading activities remained buoyant.

Its core profit rose 2.47% to RM17 million from RM16.59 million.

SEM said that the segment will continue to focus on the roll-out of its 7-Café store format with improved products and in-store customer experience, which is expected to contribute positively to the growth of its fresh food category.

“We plan to complete the construction of our new fresh food commissary in the current financial year, which has a capacity to serve up to 1,000 stores in Klang Valley,” it said.

On its prospects, the group is cognisant and remained steadfast in monitoring potential headwinds such as global supply chain disruptions and workforce supply constraints.

“Essentially, we will take appropriate measures to mitigate these impacts, as necessary.”

Its share price closed unchanged at RM2.04 on Thursday, with a market capitalisation of RM2.52 billion.