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Suning loses power as it revises profit estimate
By Pan Xiaoyi |
January 22, 2009, Thursday
|
Print Edition
Print Edition
SUNING Appliance Co tumbled more than 9 percent yesterday after it lowered its estimate of net profit for 2008.
China's second-largest electronics retailer said it expected net profit to rise 40 percent to 50 percent from a year earlier, down from a previous projection of between 60 percent and 80 percent. Net profit in 2007 was 1.47 billion yuan (US$215 million), Suning said in a statement to the Shenzhen Stock Exchange yesterday.
Its stock fell 9.1 percent to 15.88 yuan in Shenzhen, compared to a 0.46-percent loss in the Shanghai Composite Index.
Meanwhile, major rival Gome Electrical Appliances Holding Ltd is rolling out its strategic plan for 2009 to combat falling demand.
A senior official of the country's No. 1 retailer said that the company's focus will shift from expanding the number of stores to increasing same-store sales after aggressive expansion through mergers and acquisitions over the past few years.
Up to 100 poorly performing outlets will be closed while the same number of new ones will open. The number of stores will remain at 1,300, the official said.
Dazhong Electric Appliance Co, which was acquired by Gome, had earlier announced the closure of four stores in Beijing.
Gome is to make home appliances and communication, computer and digital products its new growth drivers and is aiming at a market share of 15 percent this year.
Suning has 812 stores across the country and plans to open 200 more this year.
China's second-largest electronics retailer said it expected net profit to rise 40 percent to 50 percent from a year earlier, down from a previous projection of between 60 percent and 80 percent. Net profit in 2007 was 1.47 billion yuan (US$215 million), Suning said in a statement to the Shenzhen Stock Exchange yesterday.
Its stock fell 9.1 percent to 15.88 yuan in Shenzhen, compared to a 0.46-percent loss in the Shanghai Composite Index.
Meanwhile, major rival Gome Electrical Appliances Holding Ltd is rolling out its strategic plan for 2009 to combat falling demand.
A senior official of the country's No. 1 retailer said that the company's focus will shift from expanding the number of stores to increasing same-store sales after aggressive expansion through mergers and acquisitions over the past few years.
Up to 100 poorly performing outlets will be closed while the same number of new ones will open. The number of stores will remain at 1,300, the official said.
Dazhong Electric Appliance Co, which was acquired by Gome, had earlier announced the closure of four stores in Beijing.
Gome is to make home appliances and communication, computer and digital products its new growth drivers and is aiming at a market share of 15 percent this year.
Suning has 812 stores across the country and plans to open 200 more this year.
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