Mobile World (MWG) sees profit rise despite COVID-19

Mobile World (MWG) sees profit rise despite COVID-19

The company recorded two-month profit after tax of VND845 billion (US$36.2 million), up 16 per cent year-on-year and consolidated net revenue of VND20.5 trillion, up 18 per cent against 2019.

In two months, sales of telephone and electronic products recorded growth and that of refrigeration and home appliances also increased by more than 15 per cent.

Laptop products saw a strong growth of 80 per cent compared to the same period last year, due to the increase in the number of people and students working and learning from home.

With 253 watch stores, MWG earned nearly VND300 billion from the sale of watches. Sale of fresh foods and fast moving consumer goods (FMCG) also more than doubled.

Revenue from online sales contributed 6 per cent of MWG’s total revenue, reaching VND1.22 trillion. MWG currently has three websites meeting mobile phone shopping, consumer electronics, and FMCG demand (thegioididong.com, dienmayxanh.com and bachhoaxanh.com).

Bach Hoa Xanh slackens expansion

In February, Bach Hoa Xanh store, a grocery retail chain of MWG, recorded average monthly sales per store of VND1.2 billion, higher than that of VND900 million in the same period last year.

The number of online orders received by Bach Hoa Xanh in the month increased approximately 30 per cent compared to January 2019 and doubled the average monthly online orders last year.

Since the beginning of February, MWG has been slowing its expansion plan for Bach Hoa Xanh as the company wishes to monitor more closely the impact of the COVID-19 disease and carefully study customer demand to deliver appropriate response scenarios.

Bach Hoa Xanh set a revenue target of VND122.4 trillion this year, post-tax profit of VND4.8 trillion, increasing by 20 per cent and 26 per cent compared to 2019, respectively.

Increase market share

This year, MWG targets a 5-per-cent in the Same Store Sales Growth (SSSG) of its mobile phone retail chain store The Gioi Di Dong and electronics retail chain Dien May Xanh.

MWG also sets a target for a market share of 55 per cent and 50 per cent for mobile phone and electronics products by 2022, respectively.

In 2019, MWG completed the change of layout for its all 1,018 Dien May Xanh mini-stores to optimise the number of SKUs (Stock-Keeping Units) and the size of the product display area.

This initiative helped MWG boost sales of good-performing stores located in high potential areas but without the opportunity for space enlargement. These stores recorded 30 per cent revenue growth while their rental and operating expenses remained almost unchanged.

The company plans to change the layout for 250 remaining stores this year.

MWG is putting its The Gioi Di Dong mini store model on trial with 10 stores to further penetrate the suburban areas.

In December 2019, MWG officially opened its first Big Phone+ store in Cambodia.

According to its leaders, the monthly revenue of Big Phone+ in January and February both reached VND3 billion. As business shows positive growth, MWG plans to open 10 new Big Phone+ stores this year.

The fashion watch segment is given key focus in 2020 as MWG targets to increase the total points of sale (POS) in 500 in the first six months, compared to 253 POS at the end of 2019.

This year’s revenue from fashion watches will increase strongly 3 to 4 times compared to 2019, thanks to the number of newly opened POS in 2020.

bizhub