HBC sees sales hitting P2.75B

MANILA, Philippines - Homegrown cosmetics retailer and pharmacy firm HBC Inc. expects another banner year on the back of store expansion, robust consumer spending and new distribution channels.

HBC expects its revenues to hit P2.75 billion this year, in line with the target of reaching the P5 billion mark and list in the local bourse in the next three years, an executive said.

“For this year we are projecting a 21-percent increase in revenues from P2.26 billion to P2.75 billion,” Noel P. Manucom, president and chief operating officer of HBC, said in an interview.

Manucom said election spending and the government’s infrastructure expansion program will boost employment and consumer spending, which will bode well for the retailing sector.

The personal care retailer has been posting double digit growth, with revenues surging 29 percent to P2.26 billion last year from P1.75 billion in 2011 and P1.4 billion in 2010.

Manucom said the company wants to list in the local stock exchange after it hits the P5 billion revenue mark in the next three years.

HBC has programmed expansion and consumer awareness programs this year to boost sales further.

“We will focus on franchising. We stopped before because we made little changes in the business model,” Manucom said.

HBC plans to open seven franchised stores this year and introduce 15 store-within-a-store concepts, which have display racks inside high traffic areas like supermarkets and department stores, he said.

The Hortaleza family’s personal care store chain did not open new branches last year, ending 2012 with 226 stores as it completed the consolidation of pharmaceutical retailer Savemore Drug Inc.

In August, 2011, HBC acquired the Gatmaytan family’s Savemore, which has 52 branches in Metro Manila and Bulacan.

“With the entry of Savemore into our operations, we felt it was time to change the business model,” Manucom said.

From selling only house brands Beauty Exclusives, the company added a pharmacy section to 35 HBC branches, increasing transaction count in the stores.

HBC is retaining the cosmetics orientation in shopping malls but the company can add pharmacy, food and non-food items in other 63 HBC branches, Manucom said.

For its expansion, the beauty retailer is offering the kiosk and cart packages targeting families of overseas Filipino workers in Visayas and Mindanao. HBC has 194 in Luzon, 16 in Visayas and 16 in Mindanao.

Benchmark investment for carts and kiosks is P300,000 and P500,000, respectively, including initial inventory.