Business Review

Robinsons Retail achieved Php192.1 billion in net sales in 2023, a notable increase of 7.4% supported by blended same store sales growth (SSSG) of 3.9% and store expansion initiatives. Despite the impact of inflation on consumption and a challenging base in 2022 which benefitted from economic reopening and election-related spending, the company continued to demonstrate resilience. The primary drivers of revenue growth were the core staples businesses, namely supermarkets and drugstores, which collectively accounted for over 70% of revenues.

Gross profit rose by 7.8% to Php45.6 billion in 2023, outpacing revenue growth. This was propelled by assortment shifts and the sustained penetration of private label brands. Operating income also experienced moderate growth, rising by 2.8% year-on-year to Php8.9 billion.

Net income attributable to equity holders of the parent company however decreased from Php5.8 billion in 2022 to Php4.1 billion in 2023. The decline was due to the reversal of foreign exchange gains in 2022 to a loss in 2023 due to the appreciation of the peso against the US dollar, the derecognition of Robinsons Bank’s net income under equitized earnings following its merger with BPI, and losses from start-up investments. Meanwhile, core net earnings, which exclude foreign exchange gains/losses, interest income from bonds, equity in earnings from associates, interest expense related to the BPI shares acquisition financing, BPI cash dividends, and other one-time or non-operating items, exhibited marginal growth of 1.5% to Php5.6 billion.

Throughout the year, Robinsons Retail expanded its footprint by adding 84 new stores, predominantly in the Supermarket and Drugstore segments. This brought the total number of stores to 2,393, comprising 349 supermarkets, 1,054 drugstores, 50 department stores, 230 DIY stores, 408 convenience stores, and 302 specialty stores. Additionally, the company operates 2,127 franchised stores of TGP. The assortment of specialty stores includes 119 appliances & electronics stores, 42 toys stores, 118 mass merchandise stores, 11 beauty stores, 10 pet stores, and 2 lifestyle sneakers stores.

Contributing to Shared Growth:

Direct Economic Value Generated and Distributed

* Restated 2021 and 2022 values due to the original inclusion of third-party manpower wages in the employee wages and benefits.

At Robinsons Retail, we aim to create long-term value and shared successes within the communities we operate in. Through our operations and supply chain, we are able to impact local economies by generating employment and nurturing a robust network of partners and suppliers from various entrepreneurial backgrounds.

To ensure a healthy financial standing and sustained resilience, we maintain rigorous business continuity plans to protect our assets and have a dedicated Enterprise Risk Management Team, overseen by our Board of Directors.

We continue to implement our Share Buy Back Program worth Php7.0 billion to increase shareholder value and optimize returns for our investors. Our annual cash dividend of Php 2.00 per share in 2023 equates to a payout ratio of 50%, above our 40% dividend policy.

Looking forward, we are focused on expanding our presence in underserved areas, strengthening our omnichannel strategy, and pursuing strategic acquisitions to drive growth. Additionally, we are committed to operational efficiency, sustainability, and data-driven decision-making, ensuring that we continue to deliver value to all stakeholders while navigating the evolving business landscape with resilience and foresight.

Thriving in Tandem

On January 1, 2024, the merger between BPI and Robinsons Bank was finalized, with BPI emerging as the surviving entity. Robinsons Retail now effectively owns 6.5% of BPI and is entitled to a board seat in the bank.

Robinsons Bank has played a pivotal role in helping our key suppliers grow through the financial products and services that it has offered, and this is expected to grow even more with the facilities now accessible through BPI, helping them enhance their operational capabilities and service offerings. This ripple effect cascades throughout our supply chain, resulting to improved efficiency, reliability, and ultimately, enhanced customer satisfaction.

Omnichannel is Now

Our digital investments remain vital as we continue to expand our digital footprint to accelerate our omnichannel strategy.

We maintain a 14% stake in Growsari, a technology-driven B2B platform serving over 1 million sari-sari stores across the Philippines, with products sourced from Robinsons Supermarket. Growsari’s monthly active store users continue to increase, all serviced via 23 distribution centers.

Now with close to 3 million customers in merely 14 months since it began commercial operations, GoTyme continues to make waves in the digital banking space. We currently have a 20% stake the digital bank, which now has close to 400 bank kiosks located at our stores. We continue to be able to onboard more customers on GoTyme, which allows them to receive a debit card within minutes but also conveniently cash-in and cash-out for free across our stores and earn Go Rewards points every time they use their cards. As GoTyme continues to accelerate, has also helped accelerate the growth of our Go Rewards customer base, which now has more than 8 million members.

Our 23% stake in O!Save, a hard discount supermarket chain established in 2021, also continues to yield promising results as it continues to expand across the country. This collaboration enables us to tap into the growing hard discount supermarket segment, while enabling O!Save to tap into the expertise and resources of an established retail player like us.

Finally, GoCart, our in-house e-commerce platform dedicated to our formats, remains essential to realizing our omnichannel push. GoCart continues to allow us to bridge the gap between our physical stores and our online footprint, offering customers convenience and flexibility in their shopping journey.

Our People

Diversity Drives Innovation

At Robinsons Retail, diversity is our strength. Each member of our team brings a unique set of skills, perspectives, and experiences to the table, enriching our approach to business and driving innovation forward. We understand that fostering an inclusive workplace is not just the right thing to do – it is essential for our success.

Our hiring and onboarding process are designed to be objective and non-gendered, ensuring that we attract and retain a diverse pool of talent. We are committed to creating environments where everyone, regardless of gender, feels valued and empowered to contribute their best work.

At Robinsons Retail, women are at the helm, steering our Company’s success across all facets of management. Currently, women comprise 70.5% of our workforce, occupying key positions, including our President and CEO, Chief Financial and Chief Risk Officer, Treasurer, Corporate Secretary, and Head of Corporate Planning, Investor Relations, and Sustainability. Additionally, 65.9% and 66.1% of women employees hold managerial and supervisory roles, respectively.

Our efforts in championing our employees resulted in our re-inclusion in the Philippine Daily Inquirer and Statista’s list of the Philippines’ Best Employers, together with our subsidiaries, Robinsons Supermarket, Robinsons Appliances, Rose Pharmacy, and South Star Drug.

2023 Demographics

Diversity and Equal Opportunity

Employees in the Workforce

Employees in Executive-Level Positions

Employees in Managerial Roles

Employees in Supervisory Roles

Employees in Rank-and-File Positions

A Safe Place to Work

Ensuring the occupational health and safety of our employees is paramount to us as it directly impacts overall well-being and productivity. We adhere to stringent safety, health, and welfare standards established by the Department of Labor and Employment to guarantee safe and healthy working conditions for everyone who interacts with our establishments.

In addition to complying with regulatory requirements, we maintain comprehensive Security and Safety Manuals that undergo regular review to ensure their ongoing effectiveness and relevance. These manuals serve as vital resources for our teams, providing clear guidance on best practices and protocols to mitigate risks and respond effectively in emergency situations.

To further bolster our preparedness, we have established a Corporate Emergency Response Team (CERT) entrusted with leading crisis management initiatives across our conglomerate. The CERT oversees the periodic review of contingency plans and emergency preparedness procedures to uphold our commitment to effective responses and responsible crisis management.

By prioritizing occupational health and safety and maintaining robust emergency response mechanisms, we strive to create a secure and resilient environment for our employees, customers, and stakeholders alike.

Robinsons Retail Academy

We believe in investing in our people, empowering them to reach their full potential and thrive in their roles. Through comprehensive training programs, personalized development plans, and continuous learning opportunities, we equip our employees with the skills and knowledge they need to excel.

The Robinsons Retail Academy (RRA) is a flagship initiative crafted by our Learning & Organizational Development (L&OD) team to provide learning opportunities to its employees. RRA is a beacon of structured employee development, offering a comprehensive array of learning opportunities tailored to enhance skills, deepen knowledge, and cultivate expertise across the Company.

With a focus on aligning training initiatives with our business objectives, RRA serves as a centralized hub for all things learning. The RRA provides a unified platform streaming access to a diverse range of courses, workshops, and seminars.

Sustainability 101

As part of our New Employment Orientation program, new employees also receive a comprehensive overview of sustainability within the context of the Company’s operations against the broader global landscape. Robinsons Retail’s Sustainability Manager provides an overview of our sustainability initiatives, emphasizing our responsibility to minimize our environmental impact, support local communities, and promote ethical practices throughout our supply chain.

Through real-world examples and interactive discussions, employees uncover the tangible ways they can contribute to our sustainability efforts, both within and outside the workplace fostering a sense of stewardship from day one. We empower our new hires to become champions of sustainability within Robinsons Retail and beyond.

Nurturing Partnerships for Shared Value

Our suppliers and trade partners are integral to our creation of shared value as well as supporting the livelihood of various businesses and providing access to goods for our end-consumers. Currently, over 90% of our vendors are Philippine-based manufacturers and distributors, including those that source products abroad and serve as the official distributors of foreign brands.

To reinforce our commitment to nurturing better relationships with these essential partners, we continue to work towards improving forecasting demand to maintain just-in-time inventory deliveries to increase supply efficiency allowing us to reduce shrinkage or wastage. Through the cross-docking systems at our distribution centers, we are also able to speed up the delivery of products and reduce the unnecessary maintenance of stocks.

To thank our partners for a successful 2023, we held our annual Trade Partners Nights highlighting the vital contributions of our partners as we continue to create value, drive excellence, and deliver unparalleled service to the customers and communities we serve.

Energy Management and Climate Action

As our store and office operations rely heavily on electricity and fuel, we remain steadfast in our commitment to reducing our carbon footprint. We continue to convert our refrigeration and air-conditioning systems using lower-impact refrigerants and explore energy-efficient technologies. We will start to conduct more rigorous energy and emission reduction studies and explore renewable power purchase partnerships, prioritizing facilities with higher energy consumptions in order to eventually reduce our energy and emission intensity as we continuously expand our store network.

* Restated 2021 and 2022 values due to the original inclusion of third-party manpower wages in the employee wages and benefits.

Water Management

While our operations may not demand extensive water usage compared to certain industries, we uphold a vigilant stance on monitoring our water consumption. Sourcing water from local-third party lines, we prioritize efficient and responsible usage practices across our offices and stores.

Our water use mainly stems from office and store lavatory facilities and routine maintenance and cleanliness protocols. To mitigate waste and conserve water, we implement regular monitoring of our plumbing and water systems. By proactively identifying and rectifying issues such as leakages, we minimize the risk of significant water loss and ensure sustainable management of this essential resource. The increase in 2023 water consumption is a result of the data gathering improvements from our stores and warehouses.

Climate Resilience Project

Our Journey towards Climate Action

As a business, we continue to do our part for climate action. This journey began in 2019 with the publishing of our inaugural stand-alone Sustainability Report.

In 2021, we embedded sustainability and climate risk considerations into our ERM framework. We also embedded Sustainability into our Corporate Governance committee as we intend to drive more sustainability and climate agenda in board-level discussions. Aspiring to set our climate and sustainability targets in the coming years, we recognized the importance of a credible baseline data for target setting. Thus, we engaged an independent consultant for our first ESG external assurance covering 2022 disclosures, whereby reporting improvements were recommended for energy and climate disclosures. We also recalibrated our sustainability framework, simplifying them to cover 4 focus areas reflecting the material topics that our retail business must tackle at scale.

Continuing our momentum, we initiated our climate resilience journey as we aim to solidify our climate mitigation and adaptation targets and roadmap. This involved assessing our exposure to physical climate hazards and conducting vulnerability assessment of selected business-critical pilot facility to develop tailored adaptation strategies. These proactive steps position us to adhere to anticipated updates to sustainability reporting guidelines, such as the SEC SR Guidelines and the launch of the IFRS Sustainability Disclosure Standards. We also started to initially map out and partially disclose our other indirect GHG emissions across our value chain (Scope 3 GHG emissions) as we commit to involve our stakeholders across our value chain to participate in climate action. These milestones lay the groundwork for a strategic shift towards a more sustainable and climate-resilient future, setting the tone for years to come.

Our Approach and Strategy in Climate Resilience

Situated in an archipelagic region prone to tropical cyclones, our businesses face such inherent climate hazards. Intense tropical cyclones, flooding, and rising temperatures could adversely impact our assets, operations, and workforce. As a foundational step in our climate strategy, we have identified and assessed climate-related physical risks and opportunities at a facility-level, alongside their operational and business impacts. We have evaluated our climate resilience in coping with the various climate scenarios. This process allowed us to gauge the inherent resilience of our assets and develop tailored risk mitigation strategies to enhance operational efficiency and business continuity. This targeted analysis represents the first phase of a broader strategy that we plan to be replicated across our portfolio of critical operational assets. We are integrating this climate resilience assessment into our business processes, utilizing them to refine strategic planning, and strengthen our Enterprise Risk Management and Business Continuity Planning. This ensures our approach to managing climate risks is robust and actionable at the operating unit level.

IPCC's Representative Concentration Pathways (RCP) 8.5 and 4.5 was selected for our analysis. RCP 8.5 represents a high emission scenario, indicating a future where greenhouse gas emissions continue to rise rapidly leading results in greater impacts from physical hazards such as higher global temperature increase, intense extreme weather events and faster sea-level rise as a consequence of inaction on climate change. Conversely, RCP 4.5 represents a scenario where emissions peak around mid-century before declining. By considering both pathways, we encompass a broad spectrum of potential future emissions trajectories for climate-related physical risks.
Our definitions of short-term (1-5 years), medium-term (6-15 years), and long-term (16 years and beyond) closely mirror the general timeframes used in our strategic decision-making. The 2030-2060 timeframe, which falls under medium-term to long-term, was chosen to match the projected timelines of climate models and the operational lifespan of assets, ensuring the assessments remain relevant. Additionally, in 2025, we plan to evaluate the impacts of the low-carbon transition and climate-related transition risks and opportunities on our business under the RCP 2.6 scenario.