Store Closures, but Increased Revenue for MWG
MWG, or Mobile World Investment Corporation (stock code: MWG), has just released its financial report for the first seven months of the year. The company recorded a gross revenue of VND 76,541 billion, a 15% increase compared to the same period last year. MWG has achieved 61% of its annual revenue plan.
MWG closed 18 The Gioi Di Dong stores (including Topzone) in July.
A breakdown of the revenue structure shows that Dien May Xanh contributed the highest proportion with 46.2%, followed by Bach Hoa Xanh at 30.1%, The Gioi Di Dong (including Topzone) at 20.9%, and other segments. Specifically, The Gioi Di Dong and Dien May Xanh’s revenue reached VND 7,200 billion, a 5% increase compared to the previous year but a decrease compared to the previous month.
Cumulative revenue for the first seven months for The Gioi Di Dong and Dien May Xanh chains reached VND 51,300 billion, a 6% increase compared to the same period last year. Bach Hoa Xanh contributed approximately VND 23,000 billion to MWG’s revenue, a 40% increase year-on-year.
Notably, the wave of store closures for The Gioi Di Dong continues to expand. As of the end of July, MWG had 1,028 The Gioi Di Dong stores (including Topzone), a decrease of 18 stores compared to the end of June. Similarly, the Dien May Xanh chain reduced its stores by 59, leaving 2,034 stores.
Plans to Close 200 An Khang Pharmacies
The most significant reduction was in the An Khang pharmacy chain, which closed 94 stores within a month, leaving 387 pharmacies. Compared to the same period last year, The Gioi Di Dong has scaled down 150 An Khang pharmacies.
At a recent meeting with investors and shareholders of MWG, Mr. Doan Van Hieu Em, CEO of The Gioi Di Dong, shared that the An Khang pharmacy chain is undergoing a restructuring process similar to that of Bach Hoa Xanh and Dien May Xanh. Accordingly, MWG is evaluating each pharmacy and will close those that are not meeting revenue and profit expectations.
The An Khang pharmacy chain closed 94 stores within a month.
As of December 31, 2023, the An Khang chain had 527 pharmacies, but by the end of the second quarter of this year, that number had dropped to 481. Currently, each pharmacy is generating an average revenue of VND 500 million per month. It is anticipated that the number of An Khang pharmacies will be reduced to 300 by the end of this year, resulting in the closure of nearly 200 more An Khang pharmacies by the year’s end.
The An Khang pharmacy chain was originally known as Phuc An Khang pharmacy, which was acquired by The Gioi Di Dong in 2017. However, it wasn’t until 2022 that MWG fully invested in the An Khang chain, rapidly expanding its scale and opening hundreds of new stores. At that time, MWG set ambitious goals, targeting 800 stores by the end of 2022 and 2,000 stores by the end of 2023.
Nevertheless, the chain’s financial performance fell short of expectations, leading to a halt in the expansion plans. In 2023, An Khang only added 27 pharmacies, bringing the total to 527.
During the period of 2022-2023, the An Khang chain incurred losses of over VND 300 billion each year. In the first half of 2024, An Khang recorded a loss of VND 172 billion, bringing the cumulative loss as of the end of June 2024 to nearly VND 834 billion.
For this year, The Gioi Di Dong has set targets for An Khang to achieve double-digit growth, increase market share, and reach breakeven before December 31.
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