Mexico's Soriana sees modest Q1 sales
MEXICO CITY (Reuters) - Soriana, Mexico's No. 2 retailer, said on Wednesday that sales likely grew slowly in the first quarter, hurt by ongoing sluggish consumer spending.
The company also said it plans to speed up store openings in 2010 after digesting a recent acquisition of rival Gigante's assets.
"We started to feel a certain slowdown in consumption in the fourth quarter of last year and in the first quarter of 2008 we have not noticed an improvement," Chief Financial Officer Aurelio Adan told the Reuters Latin America Investment Summit on Wednesday.
But he still said he expects same-store sales in January-March to exceed the 1.2 percent rise observed in the same period of last year.
Mexican retailers same-store sales rose barely 1 percent last year.
Soriana (SORIANAB.MX), based in the northern city of Monterrey, bought 198 Gigante (GIGANTE.MX) stores in Mexico in December and seven more in the United States to boost its market share and better compete against leader Wal-Mart de Mexico, or Walmex (WALMEXV.MX).
The company ended last year with 465 stores, and will open 15 more this year.
"Next year we will probably open 10 or 15 stores, we have not decided yet," Adan said. "Starting 2010, our business plan sees 60 stores (per year on average)."
Soriana plans to issue $1.4 billion debt in several tranches starting next month to refinance the loans it used to fund the Gigante deal.
It expects to repay 30 percent of that debt within 16 months and the rest of it by 2013.
Soriana shares fell 0.71 percent on Wednesday to close at 32.25 pesos.
(Additional reporting by Vanessa Padilla)
(For summit blog: summitnotebook.reuters.com/)
(Additional reporting by Vanessa Padilla; Editing by Gary Hill, Phil Berlowitz)
