Retailing, Franchising, and Consumerism Business Intelligence in China

China's Gome Net Profit Up 65.77% In Q1 2011

Chinese electronics and home appliances retailer Gome has published its unaudited results for the first quarter of 2011, and it is also the last quarterly report before Chen Xiao, former chairman of Gome, departed the company.

According to the report, Gome's sales in the first quarter of 2011 reached CNY13.677 billion, a year-on-year increase of 16.08%; its operating profit increased from CNY532 million to CNY685 million, a year-on-year increase of 28.76%; and its net profit attributable to shareholders increased from CNY333 million to CNY552 million, a significant increase of 65.77%.

During the first three months of 2011, Gome opened 37 new stores and closed seven stores. By March 31, 2011, the retailer had developed 856 stores in total.

Zhang Dazhong, chairman of Gome, said that they are very satisfied with the company's performance in the first quarter of 2011. The group will continue to implement its strategic plan to extend its store coverage. Meanwhile, it will update its existing stores to further improve operating capacity and market share so as to maintain its leading position in the Chinese home appliances retail chain sector.

Gome said the year 2011 is the second year for its new five-year development plan and the group will strive to expand its network; optimize supply chain systems; establish nationwide and regional distribution centers; update stores; improve consumer experiences; and enhance relationships with suppliers and banks. In addition, it will actively develop e-commerce businesses.

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