DFI Retail Group - DBS Research 2022-08-01: Still Not A Convenient Time; Awaiting Visible Catalysts

• DFI Retail Group (SGX:D01) reported a headline net loss of US$52m, which includes US$60m loss from associates (largely Yonghui and Maxim). While its subsidiaries remained profitable, posting 1H22 sales of US$4.48bn (-1.2% y-oy) with an underlying operating profit of US$76m, this was 51% lower compared to the same period last year.
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• Among the performance of its subsidiaries, while Health and Beauty posted strong performance, this failed to mitigate the weakness in its Grocery Retail as well as Convenience Stores. In addition, DFI Retail Group also increased its investments in digital capacity and capability, which is said to be necessary to meet customers’ needs and to drive long-term growth and value. In its results briefing, management guided that the level of investments in its digital capabilities are likely to continue into 2H22F, and possibly FY23 as well.
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• An interim dividend of US$0.01 per DFI Retail Group share was declared for 1H22, vs US$0.03 a year ago.

DFI Retail Group - Segments commentary

Grocery Retail segment hard hit by reopening in Southeast Asia, inflation and investments.

• Read more at SGinvestors.io.

Andy SIM CFA DBS Group Research | https://www.dbs.com/insightsdirect/ 2022-08-01 SGinvestors.io

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