AEON sets RM251m for capex

The supermarket chain operator also targets 15% of revenue to be generated from its e-commerce business in the next 5 years

by ANIS HAZIM / Pic by TMR FILE PIX

AEON Co (M) Bhd has allocated a capital expenditure (capex) of RM251 million with 40% of the money set to be used on technology and IT (information technology) systems, and the remainder on renovations, maintenance and remodelling of its mall and stores.

Group MD Shafie Shamsuddin (picture) said the retailing group is looking at expansion with 13 new specialist stores, as well as renovating and making rectifications to 11 malls this year.

The supermarket chain operator also targets 15% of revenue to be generated from its e-commerce business in the next five years.

“This year, we are targeting 2% of the revenue contribution from the e-commerce segment,” Shafie said after the company’s 36th AGM yesterday.

He said the group’s outlook for the financial year 2021 (FY21) depends very much on the speed of vaccination rollout in Malaysia.

He said most businesses are experiencing a bigger impact from the Movement Control Order (MCO) this year compared to the previous MCO 1.0, but said the number of business closures is comparable to last year.

“If I look and compare the current situation of our business at this moment, we are actually looking at a comparable period of last year during the first MCO 1.0 as the number of closures is similar,” he added.

Shafie said AEON has been able to adapt to the current market condition as the company delivered a higher profit of RM22 million in the first quarter ended March 31, 2021, compared to RM7.5 million in the same period last year.

AEON expects its revenue to improve this year, hinged on the speed of vaccination and how quickly it can facilitate business reopenings.

Shafie said the company emphasised on its staff and customers safety, and sees vaccination as a priority.

“We hope the sanitation we plan to do and the vaccination for our employees and partners will contribute to a better outlook by the end of 2021,” he said.

AEON has supported its tenants throughout the MCO by providing waivers of discounts and allowing them to pay the rents on an instalment basis.

“We also offer financing for those who have difficulty to get a loan by linking them up to our partners like AEON Credit Service (M) Bhd that can give them financing options,” Shafie said.