Upson International Corp., a leading information technology retailer in the Philippines, said Monday net income last year dropped 14 percent to P464.2 million as gross margin fell and higher pre-operating costs.
Revenue rose 5.8 percent to a record P10 billion, fueled by opening of new stores. Comparable sales from existing stores was up 1 percent.
Upson said by product category, computers were the primary driver of the increase led by mid-range laptops. Printing and communication also contributed positively, partly offset by decreases in sales of storage and components, it added.
By geography, markets remained broadly stable with Visayas posting the fastest growth followed by North Mindanao.
“2023 was a year of investment and transition, evolving from being privately held to becoming a public company,” said Upson chief executive officer Arlene Sy. “For the first time in our history, revenues surpassed P10 billion as we increasingly reap the benefits from our expanding footprint. This strong foundation is what we will build on this year. Our focus is on serving our customers better to unlock the full potential of the new stores and deliver sustainable and profitable growth,” she said.
The cost of inventories sold was up 9 percent to P7.9 billion, resulting in lower gross margin of 21 percent compared with 23 percent in 2022. The margin contraction was due to revenue mix and lower product margin rates from increased promotions, including product bundling and price discounts.
Operating expenses were up 9.5 percent to P1.7 billion in support of the company’s strategic growth initiatives, specifically relating to store and warehouse network expansion.
