JAKARTA (TheInsiderStories) - The department store manager, PT Ramayana Lestari Sentosa Tbk (IDX: RALS) plans to buy back 354.8 million shares or 5 percent of total issued and paid-up capital to increased the company’ liquidity, the management announced yesterday. The issuer prepared funds up to Rp 350 billion (US$24.30 million) for the corporate action.
The management plans to get approval on the plan from the shareholders on April 14 and will execute the buyback program no longer than 18 months. Because of the pandemic, three major retail companies, Ramayana, PT Matahari Department Store Tbk (IDX: LPPF), and PT Hero Supermarket Tbk (IDX: HERO) recorded poor performances in the first nine months (9M) of this year.
Most of their financial reports suffered due to the implementation of the large-scale social restrictions by the local government to fight the virus outbreak. Ramayana scored a loss of Rp95.21 billion in 9M of 2020 reversed with last year pocketed a net profit of Rp612.42 billion. The main cause of this loss was the significant decrease in sales from Rp4.43 trillion to Rp1.90 trillion (YoY).
In the same period, Matahari posted a net loss of Rp616.60 billion from a year ago still pocketed a net profit worth of Rp1.18 trillion. The company’ revenues also decreased by 57.49 percent in annual basis (YoY) from Rp7.82 trillion to Rp3.32 trillion.
According to CEO and VP director of Matahari, Terry O’Connor, caused of the limitation, the retailer had closed seven large format outlets and all outlets to make an efficiency due to high operational costs during the COVID-19 pandemic.
The other retailer, Hero also posted a net loss Rp339.46 billion at the end of September, increased many times from last year’ position was valued at Rp6.68 billion. The revenues decreased 27.65 percent (YoY) to Rp6.86 trillion from the same period of last year stood at Rp9.48 trillion.
The management said that during the pandemic, the company experienced significant challenges due to the implementation of the restriction and changes in customer spending patterns. The wholesale, health and beauty businesses were significantly affected by the pandemic.
So far, all company-owned retail stores such as Hero, Guardian and IKEA have been affected due to reduced operating hours, closings of several malls, strict trade restrictions on complementary businesses and limitation of customer visiting capacity.
US$1: Rp14,400
Written by Editorial Staff, Email: theinsiderstories@gmail.com
