For the third quarter from 1 October to 31 December 2021, the Sa Sa Group’s retail and wholesale turnover for the continuing operations increased by 4.7% year on year. When compared with the same period of the financial year of 2018/19 before the COVID-19 pandemic, the Group’s turnover decreased by 53.7%, an improvement over the 61.7% decrease in the second quarter.
In the Hong Kong SAR, the fruit of the Group’s still ongoing efforts to attract local customers is begin to emerge, said the group. Sales were further bolstered by the launch of the second phase of the government’s consumption voucher scheme in October 2021, the Group’s large-scale promotional campaigns and introduction of new products that were appealing to the locals, resulting an increase of 14.3% in retail sales growth in the third quarter at the Group’s local consumption dominated Hong Kong SAR market.
Although the average number of stores decreased by 16 or 16.7% year on year during the quarter, same-store sales increased by 22.9% as a result of the redeployment of the frontline beauty consultants from the closed stores to other stores, this also enhanced same-store profitability.
In the Macau SAR, the border with Mainland China had been reopened for more than a year but the COVID-19 pandemic broke out again in the end of September in 2021, with strengthened entry and quarantine measures. As a result, the foot traffic and sales of mainland Chinese customers at Sa Sa’s stores in October were both seriously affected, resulting a decrease of 13.7% in sales in the third quarter. Nevertheless, the pandemic started improving in November and sales continued to rebound in December.
Consequently, the overall retail and wholesale turnover at the Group’s operations in the Hong Kong and Macau SARs rose by 1.5% year on year in the third quarter, while same-store sales increased by 7.8%. The Group’s online business recorded a year-on-year sales growth of 19.9% in the third quarter. The increase was mainly driven by the Group’s Hong Kong-based online shopping website which had been revamped at the beginning of last year. The Group avoided excessive price competition during the Double 11 shopping festival resulting in a lower single digit sales growth for the third-party platforms during the quarter when compared to the previous year.
In Mainland China, due to the COVID-19 pandemic outbreaks in many parts of the country, as well as a slowdown in consumer sentiment, the Group’s same-store sales declined by 22.2% year on year in the third quarter.
The decline rate of the Group’s total retail sales was relatively lower, at 5.1%, as the Group recorded a net increase of eight stores in the quarter. Since the consumption sentiment of Mainland China fell short of expectations, the Group had decided to slow down the expansion of its retail network and had set the short-term goal of achieving growth by enhancing the operational performance of its existing stores.
In Malaysia, most of the Group’s stores in the country had resumed business since mid-September of 2021 when the Government adopted the strategy of “living with the virus”. Turnover at the Group’s operations there rose by 4.4% year on year in the third quarter. The Group is in a stable financial position with sufficient cash on hand to meet the needs of business operations and has in addition obtained extra banking facilities.
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