BRIEF: Sun Art returns to profits on stabilizing business, cost cuts
Sun Art Retail Group Ltd. (6808.HK), operator of the RT-Mart supermarket chain, said on Tuesday it returned to the black in the six months through September, crediting stabilizing store traffic and cost cuts. The company said it expects to report a profit of 150 million yuan ($21 million) to 200 million yuan for the six months through Sept. 30, the first half of its fiscal year, reversing a 378 million yuan loss in the year-ago period.
It said stabilization in its store traffic helped it to achieve positive same-store sales growth during the six-month period. At the same time, it also said “the rapid advancement of cost reduction and efficiency enhancement initiatives” yielded “significant results.”
Sun Art and other traditional grocery store operators have faced difficulty in recent years due to competition from online grocers, as well as warehouse-style grocery store operators like Costco and Sam’s Club. Sun Art fell into the red as it lost business to those rivals, reporting a 1.6 billion yuan loss in its fiscal year through March 2024.
Sun Art’s stock rose 15% in Wednesday trade after the announcement.
By Doug Young
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