Parkson Retail’s net profit plunged 33.1% in Q1

Results will worsen before picking up.

Parkson Retail saw a slow start to FY15 when its net profit plunged 33.1% to $6.2m in the first quarter, Its recurring profit crashed 33% year-on-year, while same-store sales growth also worsened sequentially.

According to OSK DMG, sales in Parkson’s core market Malaysia fell 4.4% while Vietnam sales fell 5.5%. OSK DMG warns that there’s no quick turnaround in sight in light of low consumer confidence in Malaysia and intensifying competition in Vietnam.

“We had earlier expected FY15 to remain difficult, but business conditions now appear to have worsened. While PRA has a proven business model to ride this out, we expect profit to worsen before picking up,” noted OSK DMG.