HomePro posts weaker-than-expected profits in third quarter due to lockdown measures

Home Product Center (HMPRO), a leading home improvement retailer in Thailand, reported lower-than-expected earnings in the third quarter of 2021, dragged down by store closure from lockdown measures, it said Tuesday. 

HMPRO’s third-quarter earnings were 870 million baht, down 38 per cent year-on-year and 39 per cent quarter-on-quarter. The results fell short of market expectations by 23 per cent. 

During midday, HMPRO traded at 14.50 baht, up 1.4 per cent from its prior closing. 

A total of 33 HomePro stores in Thailand were closed in the third quarter, as well as seven outlets in Malaysia. 

The company did not open any new stores in the quarter, leaving it at 115 stores in total.

Temporary store closure in July and August, when the Covid-19 pandemic severely impacted the country’s economy, resulted in a drop in the company’s sales by 18-25 per cent, executive Wannee Juntamongkol said in a statement. 

As customers were unable to visit stores physically, the company saw a spike in sales via online channels compared to a year earlier, Wannee noted. 

However, “this has partially offset the loss of sales due to store closures,” she said.

An analyst at KGI Securities, forecast that HMPRO’s third-quarter earnings should be bottom of the year and it should see positive momentum going forward in line with the country’s reopening. 

“We currently maintain a rating of Outperform with an end-2022 target price at 15.00 baht.”

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