Robinsons Retail Holdings, Inc.

Good afternoon, everybody. Thank you for joining us to review Robinson's retail holdings and audited results covering the first nine months of this year. I'm Gina Dipaling, the company's investor relations officer. Joining me in the call are our president and CEO, Ms. Rubina Gokongwete. RCFO, Ms. Maylene Casiban, the Managing Director of the Supermarket Segment, Stan Nicole, the Group General Manager of the Drugstore Segment, Christine Tuarez, the Group General Manager of DIY Pets and Mass Merchandise, Mr. Charles Chuson, Group General Manager of Robinsons Department Store and Toys R Us, Ms. Elina Chua, General Manager of Ministop, Charest Ramalingan, And then General Manager of the Appliance Segment, Jovi Santos, General Manager of Goal Robinsons, Edna Belleza, and ER Rolian, the co-founder and CEO of GoSari will be joining us during the Q&A session. This presentation will cover the financial highlights of our operations for nine months this year. an update of our store network and e-commerce platform, a detailed discussion on our financials, and some recent company developments. A brief question and answer session will follow the formal presentation to be answered by the management team. As a reminder for the Q&A portion, please use the Q&A function on your Zoom dashboard. We will appreciate it if you limit yourself initially to a maximum of three questions. including follow-up, so we can accommodate as many participants as possible. You may queue back in for further questions. If you have any concerns regarding the sound quality of the call, please feel free to send your comments or concerns via the private chat to the host, Eric Isolabo. With that, I'll turn you over to our president, Mr. Yeo.

Good afternoon. Let me summarize RHI's consolidated results for the third quarter of 2021. Consolidated net sales grew by 8.3% to 37.5 billion. Blended same-store sales growth of negative 1.3%. E-commerce sales grew 3.5 times year-on-year, accounting for 4.8% of sales. Gross profit margin was sustained at 22.8%. 60 bps quarter-on-quarter EBITDA margin expansion to 8.7%. Net income attributable to equity holders of the parent company increased by 38.7% to 1 billion. Store portfolio of 2,179 stores and 2,000 PGP franchise branches nationwide. Robinson's retail store network stood at 2,179 stores plus 2,000 franchise stores of PGP as of end September. Our stores serve as the fulfillment centers for Go Robinson's, our e-commerce site, which is the main online hub for our formats. Go Robinson's currently serves a total of eight banners. Sales grew 8.3% to 37.5 billion in the third quarter despite the elevation of NCR to ECQ, the strictest form of community quarantine for two weeks in August. This was driven by the double digit SSSG of the drugstore segment and positive SSSG of the department store, convenience store and specialty store segments. Rose Pharmacy contributed 2.3 billion in the third quarter and 6 billion in the nine months. Consolidated net sales for the first nine months reached 108.9 billion. Supermarket and drugstore accounted for 76.9% of sales. E-commerce grew four times in the nine months versus last year, accounting for 3.5% of total sales, surpassing the upper range of our full-year target with most segments already exceeding their target for the year. Blended SSSG for the quarter was negative 1.3%, an improvement from negative 11.7% in the same period last year and negative 3.4% last quarter of this year. Year-to-date, same-store sales growth was at negative 7.4%. Gross margins slightly dipped to 22.8% in the third quarter, but was up 130 dips overall in the nine months to 22.8% from the higher vendor supports received in the first half of the year. Quarter on quarter EBITDA margins expanded by 60 bps to 8.7% in the third quarter due to better cost controls, improving our EBITDA margins to 8.2% in the nine months from 8% in the first half. Net income attributable to parent increased by 38.7% to 1 billion for the third quarter, driven by the positive SSSG of most segments. lower OPEX as a percent of sales, Forex gains, increase in earnings from associates, and lower accretion on interest expense from lease liabilities. Net income attributable to parent for the nine months reached 2.7 billion, registering a 13.3% year-on-year growth. Now we move to Stanley Koh, the Managing Director of the Supermarket segment.

Thank you, Mr. Bina. Good afternoon, everyone. Net sales of the supermarket segment, including no brand and grocery, amounted to 21.8 billion in the third quarter, bringing nine months net sales to 64 billion. Aside from the high base of 11.5% last year, sales were challenged by the emergence of both offline and online competitors, which include social commerce, community group buying, and even suppliers venturing into direct e-commerce with our own customers. Also contributing are the ongoing renovations of some of our key shop-wise and the marketplace stores. These were partially offset by the surge in sales in August due to the implementation of ECQ relative the increasing cases of the Delta variant. As a result, nine months SSSG was at negative 11.2%. E-commerce sales already amounted to 1.1 billion for the quarter, which is equivalent to a full year e-commerce sales of last year as we added 125 new online stores and accounting for a 5.2% of sales. It reached a high of 5.8% for the month of August and increased further to 6.1% in September, despite the quarantine restrictions being downgraded to MECQ and GCQ. Year-to-date e-commerce sales reached 2.4 billion or 3.7% of sales, already higher than its full-year target of 2%. Gross margin was at 21.6% in the third quarter and 21.2% in nine months. For like-for-like comparison, if we exclude the consolidation of gross salary and no brand, gross margin expanded by 50 bps to 22.3% and 140 bps to 21.8% in nine months, driven by imported goods, improved gondola rentals, higher advertising support generated from digital promotions, and negotiation of higher volume incentives. EBITDA margin rose to 8.9% in the third quarter and 8.5% in nine months. For like-for-like basis, EBITDA margin improved by 50 bps to 9.3% in 3Q and 8.8% in nine months due to the continuous efforts to implement austerity measures, productivity improvements, and lower ECQ-related expenses versus last year, such as incentives and allowances to frontliners. As of September, there are 143 Robinson Supermarket, 71 Robinson's Easy Mart, 34 The Marketplace, 16 Shopwise, and 7 No Brand, bringing our total network to 271 stores. May I now turn you over to Tim for the drugstore segment.

So the drugstore segment posted net sales growth of 74.5% in the third quarter to 7.5 billion, reaching 19.8 billion in the nine months, up by 44.8%. Excluding the impact of Rose Pharmacy, net sales grew by 20.4% to 5.2 billion in third quarter, and 1% to 13.8 billion in the nine months. E-commerce sales grew 18 times versus last year and accounted for 3.8% of sales for the nine months. South Star Drug recorded double-digit same-store sales growth for the quarter of 13.8%, driven by the continued demand for cough, cold, and flu medications, anti-infectives, prescription medicines, and supplements. Year-to-date same-store sales growth was at negative 2.1%. Combined gross margins declined by 20 basis points to 19.6% in third quarter, and excluding the impact of Rose Pharmacy, gross margins expanded by 40 bps year-on-year. Meanwhile, gross margins of Rose Pharmacy increased by 180 bps quarter-on-quarter to 18.3% due to the continued alignment of trading terms and vendor support. Year-to-date combined gross margin was at 19.7%. EBITDA margin advanced by 100 BIPs quarter-and-quarter to 9.5% in third quarter due from the significant improvement in Rose Pharmacy. On a standalone basis, Rose Pharmacy EBITDA margin increased by 290 BIPs quarter-and-quarter to 7.6%. Year-to-date EBITDA margin was at 8.5%. As of September, the drugstore segment has 570 Southstar drugs, 300 Rose pharmacies, and 2,000 DGP stores. Now, I turn you over to Charles for the DIY segment.

Thank you, Tin. The DIY segment generated net sales of 2.7 billion in quarter 3, lower by 6.5%. Nine-month net sales increased by 7.8% to 8.3 billion, supported by e-commerce sales, which tripled. Ecom contributed 3.4% of sales and surpassed its full-year target of 2.5%. Q3 SSSG was negative 10.6%, an improvement from the negative 18.6% last year, with year-to-date up by 5.7%. Categories with strong performance as of September include tools, cleaning supplies, and flooring. The gross margins last year was unusually high at 34% to 35%, given that we were not allowed to hold promotional events. This year, gross margins have normalized to 32% in Q3 and 32.4% for the nine months. A combination of software sales and higher OPEX squeezed our EBITDA margins to 12.6%. Total DIY portfolio totaled 228 stores, comprising of 183 hand demand with Best Stores, 32 True Value and 16 Robinson's Builders. Our next speaker is Ms. Celina.

The recovery of the department store continued in the third quarter with net sales up by 9.3% to 1.6 billion despite the temporary two weeks closure of 18 of our stores in August. Net sales was up by 1.2% to 5.2 billion for the first nine months. Total e-commerce sales grew by 73%, accounting for 1.4% of sales, which is beyond our 1% target for the year. SSSG rebounded to positive 7% given the strong performance in POOM and improvement of other categories such as apparel. Year-to-date, SSSG was at 0.6%. Gross margin declined by 190 bps to 32.1% in the third quarter and 60 bps to 30.5% due to discounts in commission and fees extended to vendors. Year-to-date EBITDA margin was at 14 million or 0.3% of net sales. We opened one store in La Union, bringing our total to 50 stores. May I turn you over now to Suresh for the convenience store segment.

Good afternoon. We stopped recorded system-wide sales and net sales at $4 billion and $3.6 billion in nine months. Respectively, SSG further increased to 3.3% in third quarter from 1.7% in the previous quarter, narrowing year-to-date deficit to 13.9%. Sales from commercial areas where 56% of our stores are located are showing signs of recovery with SSG at 6.2% for the quarter. Also, around 90% of our 458 stores are already operating as of end September, an increase from 87% last year. Of the operating stores, 59% are open 24 hours versus 40% last year. Online sales climbed to 3.1% of system-wide sales in nine months from 1.1% last year. Our commission from value-added service such as telco, bill payment, cash-in increased by 29.9% year-to-year, contributing to 1.5% of sales for the nine months. Gross margin and royalty income increased by 230 DBS quarter-on-quarter to 35%, driven by the increase in our commission income and DC allowance, with year-to-date gross margin and other income at 35.2%. Aside from the sales recovery, OPEX remains fetish in third quarter. Even if we have more operating stores, this year was last year. This enabled Ministop to achieve positive EBITDA margin in third quarter at 4.9%, with year-to-date margin at 4.7%. I'll be handing over to Mr. Joby, Group General Manager of Appliance Segment. Thank you.

Okay, yeah. Thanks, Suresh. This is Maylian. So the specialty segment posted net sales of 2.8 billion in the third quarter and 8.1 billion in the nine months of this year. If we exclude no brand and grocery in 2020 financials to be comparative, Segment sales registered flattish growth in the first nine months. Meanwhile, e-commerce sales doubled and accounted for 3.1% of sales ahead of the 2.6% set for the year. Third quarter, same stores rebounded to 1.8%, supported by the resilient performance of the appliance segment. Year-to-date same stores was at 2.2%. Blended gross margins increased by 30 bps quarter-in-quarter to 24.3% in the third quarter. Year-to-date gross margins was at 25.1%, up by 180 bps on a like-for-like basis, with a notable lift from the appliances and toys segment. EBITDA increased by 200 bps to 9.1% in the third quarter, driven by the gains in gross margins, coupled with better cost control. On the like-for-like, EBITDA margin increased by 50 bps to 8.2% in nine months. The specialty segment has a total of 302 stores as of September. Moving on to working capital, Robinson's Retail's cash conversion cycle was at 14 days due to the consolidation of Rose Pharmacy, excluding Rose Pharmacy's cash conversion cycle was at 12.4 days, just slightly up versus last year. In terms of capital expenditures, the group spent 1.5 billion in capex for the first nine months of 2021. Supermarket accounted for the biggest share at 58%, followed by drugstores at 14%. Now I'll turn you over to Ms. Robina Gojuwepe.

We are pleased to announce that Robinson Supermarket and Robinson's Easy Mart received 45 out of 52 Gold Baguiz Awards given during the departmental of Trade and Industries E-Convention held last October 22. For 2021, a total of 88 Robinson supermarket and Robinson's Easy Mart stores were recognized by DTI with the other awards given earlier this year. Another notable achievement is all Robinson supermarket stores and the marketplace in Cebu also became Baguiz recipients last June 9, 2021. This program gives due recognition to establishments in the Philippines that uphold the rights of consumers with the following factors taken into account. Compliance to fair trade laws, customer relations, store management operations, social commitment and responsible business sector, and compliance to ISO 9001 quality management system standards. We would like to thank the Department of Trade and Industry for acknowledging our efforts for consumer welfare. U.S.-based cooperative Do It Best Corporation once again gave recognition to Handiman Do It Best Philippines. during the company's fall market held in Indianapolis, Indiana on September 24, 2021. Handyman Do It Best was awarded second place in highest international total purchases for the fiscal year ended June 2021, making us one of DID's top international members. Do It Best Corporation is one of the world's biggest cooperatives for home improvement, and it currently works with 4,000 member companies located in 38 countries. TGP conducted its annual two-day summit for pharmacists and franchisees on August 25 and 26. Day one was attended by over 600 TGP pharmacists with talks on adaptations drugsters have to make in a pandemic and post-pandemic reality. Day two of the summit was attended by close to 500 franchisees, where TGP was commended by the Department of Trade and Industry Secretary Ramon Lopez for driving the growth of small businesses. The event concluded with TGP's Founders' Cup Awards and Trade Partners Awards, recognizing top-performing franchisees and suppliers respectively. South Star Drug and Rose Pharmacy held a joint summit for pharmacists on September 25 and 26 in concurrent celebration of World Pharmacists Day. The summit was attended by over 1,000 pharmacists from South Star Drug and Rose Pharmacy with insightful dialogue among industry leaders. The drugstore banners also honored 15 exemplary pharmacists for showing exceptional performance over the last year. We bolster our commitment to sustainability with the following key areas for 2021. So, employer engagement, community projects, and protecting our employees from COVID-19, along with increasing our capacities in linking enterprise risk management with sustainability. We continue to enroll more vendors under our supermarkets farm-to-table program with a target of around 700 farmers by end of 2021. As of September 2021, the program contributed around 20 million to total produce sales of the supermarket with 177 tons of fresh produce bought outright from partner farmers. Robinson Supermarket also engaged our suppliers for ESG through sustainable sourcing and by conducting ESG surveys for top 20 vendors. We remain committed to communities and conduct various CSR projects for vulnerable sectors and medical frontliners. Lastly, we're making significant progress in COVID-19 vaccination for employees and dependents, as well as daily monitoring of active and suspected COVID cases among our people. For community engagement, the marketplace donated self-care kits on September 2 to 150 medical frontliners at the Philippine General Hospital, in salute of everyday heroes in the ongoing battle against COVID-19. In partnership with LGUs and our own COVID projects, 66% of our employees have been vaccinated, 44% of whom have been fully vaccinated, and 22% of whom have received their first dose. At present, the Philippines has a national vaccination rate of 24%. We are happy to announce that RHI was recognized by Corporate Women's Directors International as one of the world's top companies led by women. CWDI is a nonprofit organization based in Washington, which surveyed nearly 3,000 companies in 55 countries to generate baseline data on women in leadership roles. RHI strives to create a culture of equality and career development regardless of gender, and at present, 57% of the company's leadership roles are filled by women. At this point, we will now open up the call for Q&A.

Once again, we are open for Q&A. Please use the Q&A option on your Zoom dashboard or any questions. Hi, Janet, you're now unmuted. You can share your questions.

Hi, good afternoon, everyone. I just have one question, which is actually on your non-operating line in your FS. Maybe this is a question for Ms. Mylene. I'm just curious about what drove the queue-on-queue decline of your aggregate other, well, I think the first two quarters was about 200 something million expense and then it dropped to 94 million.

Yeah, you're talking about below the line, Janet, right?

Yes, yes, below EBIT, correct.

Yeah, we had some foreign things. Yeah, so it's not better this quarter versus the previous quarters.

Okay. Is it possible to get the quantum of the FX gain?

Yeah, it's 200 plus. 232 million versus a negative Forex loss last year of 136 million.

Okay. All right. That's all for me. Thank you, guys. That's here to be. Yeah, that's here to be. Thank you, Mindy. Thank you, Gina.

Thanks, Janet.

Okay, our next question comes from Carissa MacDowell, and it's on gross salary. So the first question is, how much did gross salary contribute to sales in 3-2-21 and 9-months-21? And the second question is, for specialty stores, What led to the GTM expansion in 2021?

It's Stanley here. For the contribution of gross salary to total is roughly about 4%. Pretty much the same in three years and nine months.

Thank you, Sir Stanley. Okay, the second question is on specialty stores. What led to GPM expansion?

Yeah, it's a good, we had a better mix this quarter. So it's, you know, primarily because of appliances plus Toys R Us.

All right. Thank you, Ms. Mary.

So those are questions from Carissa Magpayo. Thanks, Carissa. Okay, the next question comes from Stephen Gabriel Oliveros. He says, hi, thanks for the presentation. I would like to ask why does operating margin remain pressured during 9 a.m. and 21 a.m.? ? When do you expect this to normalize?

Yeah, we still felt the impact of the August ACQ. We were starting on a good recovery, so to speak, before the August ACP, but then we had that one again. So that actually has an impact on the non-essential formats.

Great. Thank you, Ms. Fendi.

The next question comes from Rainer Ivan Yu. How much was the other income in forex gain reported in 2021? And were there also any one-offs reported in 2021?

There were no one-offs recorded in PQ 2021, except that we recorded a forex gain because the peso depreciated around three pesos year-on-year. And we have some dollar investments, bond investments. So... In 3Q, the Forex gain is around 171 million versus negative. Forex lost last year of around 88 million. Also, our earnings from associate also grew significantly in 3Q, around 94 million versus only 18 million last year, largely driven by the higher net income of Robinson's Bank.

Thank you, Ms. Gina. Okay, so the next question is on Rosari, and we would like to request PR or Jan to answer the question. So the question is, on Rosari, can you please share more color on the operation, on its operations? For example, on its GMV run rate, active users slash merchants, take rates, to beat their own rate, and unit economics. And lastly, what is the latest shareholding structure? This question comes from Shalyu.

Hi, good afternoon. I can answer the operations part of the question. Gross high run rate is a little over 300 million pesos a month, but growing healthily between 5% to 20% month on month. We have close to 40,000 active users that are active on a monthly basis. basis. Take rate is anywhere between 5% to 6%, depending on mix. The business is positive on a contribution margin one standpoint, which covers all direct costs to deliver an order, but is near neutral on CM2 or operating margin, which covers all operations indirect costs. We don't disclose EBITDA run rate. And on the shareholding structure, I guess this is Robinson's question, or?

It's the same, no changes.

Yeah. 28%. A little over 28%.

Thank you, Eeyore. Thank you, Christina. Okay, the next question comes from Christina Rataneller. Can you talk more about expansion plans for different segments? We have seen the number of CVS and specialty stores declining from pre-COVID. Is this going to continue and what is the plan? Again, he is asking about store expansion plans. Can you talk more about expansion plans for the different segments? And we have seen the number of CVS and specialty stores declining from pre-COVID. Is this going to continue and what is the plan?

Generally, we are... accelerating our expansion for most of our formats. Most of the opening will happen in 4Q or this quarter. Like, for example, supermarket, we will be opening 14.

14 Robinson's DC Mart in two services supermarket.

Yeah, so a total of 16 stores just for this quarter. And then for the drugstore segment, I think there will be more opening scene.

Yes, um, we will be opening of around 40 stores for each banner for Salsa and Rose Pharmacies. 40 each.

Yeah, that's for the whole year. So a total of 80. Uh, anyway, um, Supermarket over the next five years is looking at higher number of store opening per year versus our historical average store opening of around 15 stores. We'll be looking at 22, about 30 to 50 stores per year now. And then drugstore will be around 80 to 100. And the other formats will follow. For CVS, because of the you know, challenges in operating the CVS business for now. So we are also closing the non-performing stores. Because 60% of our stores are located in the CBD areas and there's no people there now. And we cannot continue paying rent without sales.

Thank you, Ms. Gina.

The next question comes from Teresa Mangoba. At what level should we expect the effective tax rate to normalize? There's been some volatility on a quarterly basis, even after accounting for the one-off CREATE-related adjustments.

Yeah, this is Mylene. It should be at the level of around 20%.

Thank you, Ms. Mylene. The next question comes from Carissa Magbayo. How many stores were closed in 2021 and how is this broken down by format?

We don't have a breakdown right now. I'll just send an email for the breakdown. But I think we closed a total of more or less 50 to 70 stores for the nine months.

Thank you. We have no open questions at the moment. Once again, please use the Q&A function if you have any questions.

Good afternoon. This is Jeanette. Can I ask a follow-up question? Go ahead. Thank you. Thanks for the acknowledgement. I'd like to ask... the management regarding your outlook for 2022, especially on top line? What are you seeing in terms of private consumption trends, at least in the current quarter? And what do you think or what are your expectations in terms of recovery in 2022? And do you have any guidance in terms of SSSG growth next year as well as GPM targets? Thank you.

This is Robina. We're seeing a very nice recovery rate starting this October, and I think it will continue on all the way to 2022. Thank you, Ms.

Robina. Could you expound on what do you mean by nice recovery? Are you expecting similar queue-on-queue trajectory as what we saw in 2021, or is it much stronger than what was registered in TQ.

If you talk about same-store sales growth, I mean, we've got formats already registering double-digit SSG this October.

I'm sorry, I'm going to flash. Wait.

Yeah, Jeanette, you wanted to ask about, if you're talking about SSSG, we saw a lot of reds, the first seven months of the year, but starting September, we're seeing blacks, and it's going to get better and better all the way to the end of the year.

Okay, thank you. Any guidance for GPM for next year?

I think we are looking at around 20 bits increase in GPM.

Okay, thank you. That's useful, Gina. Thank you very much.

That's all for me. Thanks, Janet. Okay, Shan Liu is raising his hand. We'll be unmuting you in a bit.

Can you hear me?

Yep.

Hi, thanks for your call and congrats for your result. Just a follow-up question on gross salary. Can you please provide some color? How should we think about the total addressable market in terms of the GMV or the number of users? And this is the first question. And secondly, can you also please help me understand how is the competitive landscape and how is our diversification versus the other players and do we see the need to accelerate our expansion to grab the users. And lastly, could you please provide what is the mix of the physical goods versus the services in terms of our GMP? Thank you. What's the second question again? Sorry, I didn't get that. Yeah, it's actually about how do you see the competitive landscape in our segment and how do we differentiate ourselves from our competitors? Got it.

So I think on the addressable market, based on I think even the last Nielsen report, if I'm not mistaken, there's a little over 1.2 million sari-sari stores. We think that at least 300,000 should be reasonably reachable in terms of being able to maintain a good relationship. There's going to be a long tail of stores that may not be as interesting from an economics perspective, at least within the current model. But of course, that may evolve. We also see that if we're able to genuinely grow the income of these stores, that there might be some consolidation that might happen. So I think that's what we're trying to go for. I do think that there are several things that are going to happen as we scale to more cities. I think the platform will be relevant to other small store formats as well. Namely, let's say bake shops or water filling stations or other sort of small businesses that help create more density in the network. And of course, this would be good for the suppliers that will have a different assortment strategy that will be relevant to a different store, to different channel type within the ecosystem so that's kind of in terms of where we see how the total network goes I think to your third question there is going to be a significant push to build geographic physical presence across the country and we do have plans to accelerate this in the coming quarters specifically within 2022 so So that's built into our immediate plans. Within the entire platform of Grozari, with regard to the question earlier, the 300 million runway that I mentioned is only the first party FMCG that is under JV with Robinson Supermarket. If I count the entire GMV that passes through the network, I think it's close to around double of that. That includes e-services, fin services, and all the other marketplace products that pass through the platform. And so we see that growing as aggressively as the 1B business. And in terms of competitive landscape, We are designing the platform to be supplier agnostic in the sense that the infrastructure that we're building is meant to create efficiencies and savings to any supplier or partner that wants to leverage the network. So we are starting to build partnerships with other suppliers and not necessarily a full 1P model, just like what I mentioned earlier. So we do want to be the preferred last mile partner for all companies. And so we would want to partner with anyone who's interested in the network. In terms of a similar company that is trying to play the small store network game, I don't believe there's a company that is executing in the same way that we are at the moment, at least. I hope that answers the questions.

Yeah, that's very helpful. Just maybe a bit more detailed question. Just to understand, currently in Philippines, how many layers of distributors or wholesalers from the FFCG vendors down to the Sare-Sare stores? And how many layers are we undercutting? Are we making it more efficient?

So it's anywhere between two to six, depending on geography. Okay. But if it's a grocery store, it effectively gets all consolidated into one. So there's Vendor, Grocery, through Robinsons, and then Sari Sari Store directly.

Norton, lastly, can I please ask, what is the exact breakdown of the shieldings right now? of the Grocery? You mentioned 20% owned by Robinson. What about the remaining 80%?

So, the Grocery is one of the entities under G2M Solutions, which is the holding company of the tech group. Within the G2M Solutions, RRHI is an investor. I think a little over 14%. Do you know if I'm wrong? And then Grosari Inc. is kind of the FMCG wholesaling company of G2M Solutions, of which it is 28% more or less owned by Robinson Supermarket and the balance is owned by the mother company, G2M Solutions.

So there are no other Strategy investors? No.

Okay. So, effectively, is it 100% owned by Robinson Retail?

No.

No.

No. Under Grocery, it's 28.6% owned by Robinson Supermarket.

And then 72.4% owned by G2M Solutions. of which over 14% is owned by RRHI.

So my question would be then, on the G2M, who owns the remaining 80-plus percent?

The founding team, JG Summit is also a strategic investor, and then all of our other Series A and Series B investors, Tencent, Pavilion Capital, IFC, Wavemaker Partners, Sison Capital, and ICCP SBI.

All right, great. Thank you very much.

Thanks. Thank you. The next question comes again from Fassim. As you have already achieved the target of e-commerce sales contribution, do you have a new target for the upcoming years?

It should be increasing in share as a percentage of total sales as we also continue to add more stores in our platform.

All right.

The next question comes again from Stephen Gabriel Oliveros. Just follow-up questions from his end. How is foot traffic faring so far? And number two, does the company experience any inflation pressures thus far?

Can I answer? I'll answer the first question. I think during the pandemic time, we always had this issue about foot traffic in the malls. and which affected the non-essential formats. But starting this October, when government lifted the restrictions, we saw double-digit SSSG in our non-essentials, like department store toys and appliances. So that's really good news for us. And for the inflation pressures, I think that's more of the food sector. I think Stanley can talk about it, but... I mean, what we do is when the suppliers increase their costs, we also increase our retail price and keep the same margin.

Just to add to that, there are actually a few vendors who initiated some price increases in the past months. But then again, we're expecting to see more within November and December. There would be Probably no pressure to gross margin. Any inflation would probably not erode our gross margin because we're given a price protection by the vendors.

Thank you, Mr. Bina and Mr. Stanley.

The next question comes from Rainer Ivan Yu. A question again on e-commerce. What is the target for e-commerce in the near term? And what is the sales mix between the Robinson's platform and third-party apps, especially for supermarkets, drug stores, and department stores?

Goa is about one fourth of supermarkets.

What is the target? Well, we really aim to double the contribution

What's the sales mix? Okay, for the supermarket, Go Robinson's has about one-fourth of the total e-com sales. It started only in June 2020, and we had another third-party platform that started like three years ago, so they're ahead. But Go Robinson's is already half their sales. Now for the drugstore, it's mostly tin. It's mostly our own, right?

Mostly our own, RYG. So for the third party, it's just the major third-party platforms as well, like the Grab and the Picaroo. But that's minimal. because we only sell OTC for those platforms. But for our own website, we carry or we sell everything from prescription to OTC and even to the injectables.

All right, thank you, Ms.

Rubina and Ms. Christine. Okay, we are back to Q&A. As of the moment, we have no open questions. We still have a few minutes left in the call. Please use the Q&A function if you have any more queries.

Thank you.

Okay, is there no more questions? Thank you very much and see you at the next earnings call.