Philippine Seven (SEVN) Q3 2024 earnings summary

Executive summary

• System-wide sales grew 16.5% year-over-year to ₱68.8B, with operating revenue up 16.2% to ₱64.9B for the nine months ended September 30, 2024.

• Net income rose 13.7% YTD to ₱2.58B, with Q3 net income up 13.1% to ₱813.9M.

• Q3 2024 sales increased 12.6%, driven by 2.7% same store sales growth and net addition of 254 stores year-to-date.

• Store network reached 4,022 locations, with a target of 4,570 stores by FY 2025 and ₱5.5B CAPEX planned.

• Maintained leadership in the Philippine convenience store sector, with global recognition and industry awards.

Financial highlights

• System-wide sales: ₱68.8B (+16.5% YoY); Operating revenue: ₱64.9B (+16.2% YoY); Net income: ₱2.58B (+13.7% YoY).

• Q3 2024 revenue from contracts with customers grew 12.1% YoY to ₱21.6B; YTD revenue up 16.2%.

• Q3 EBITDA was ₱2.45B, up 16.8%; YTD EBITDA reached ₱7.10B, up 10.9%.

• Q3 net margin improved to 3.77%; YTD net margin at 3.97%.

• Merchandise sales mix: Food 45%, Beverages 37%, Non-food 18%.

Outlook and guidance

• Store count projected to reach 4,570 by end of FY 2025, with 500 new stores and ₱5.5B in capital expenditures.

• Targeting at least 450 new store openings in 2024, with plans to accelerate expansion as economic conditions improve.

• Focus on expanding outside Metro Manila and leveraging high-margin food service and beverages.

• Emphasis on innovation, ready-to-eat products, and digital payment services to drive growth.

• Return on equity projected to exceed last year’s 32.07% due to improved profitability and capital allocation.