2025 Mar 28
AEON Stores (Hong Kong) Co., Limited

AEON STORES ANNOUNCES 2024 ANNUAL RESULTS CONTINUES TO ADVANCE MERCHANDISE REFORM AND FOCUSES ON OPENING GROWTH-ORIENTED STORES HASTENS DIGITAL TRANSFORMATION AND OPTIMIZES INTERNAL MANAGEMENT

(HONG KONG, 28 March 2025) – AEON Stores (Hong Kong) Co., Limited (“AEON Stores” or the “Group”; Stock code: 984) today announced its annual results for the year ended 31 December 2024. During the year, the global political and economic landscapes went through significant adjustments. With weak external demand and rising geopolitical risks casting a shadow over the global economy, retail businesses in Hong Kong and mainland China faced unprecedented uncertainties amid a prevalently challenging market environment. Thus, the Group actively adjusted its business strategy and implemented a series of reforms to adapt to market changes.

In 2024, the Group recorded revenue of HK$8095.3 million (2023: HK$8,692.9 million), representing a decrease of 6.9% year-on-year. Gross profit margin was 28.9% (2023: 29.2%). Loss attributable to owners of the Company for the year amounted to HK$338.1 million (2023: loss of HK$188.7 million). The Group maintained a strong cash position with cash and bank balances and short-term deposits amounting to HK$830.6 million (2023: HK$1,149.6 million).

Mr. Takenori Nagashima, Managing Director of AEON Stores, said, “In 2024, the market landscape in Mainland China and Hong Kong remained complex. We were cautiously optimistic and have actively reviewed our operating strategy to ensure stable business development. During the year, we were committed to pushing forward with merchandise reform, enhancing the penetration rate of our private brand, and winning customers’ favour with differentiated products. We have also actively expanded the store network, focusing on opening small specialty stores to increase profit margins, while accelerating our presence in the GBA market to solidify local business development. Furthermore, we have hastened our digital transformation, strengthened the e-commerce business performance, and further elevated the competitiveness of the e-commerce platform, contributing to significant improvements in the Group’s productivity and operational efficiency. Additionally, by optimizing internal management, we have effectively reduced operating costs.”

During the year, the Group’s staff costs decreased by 4.7% and their ratio to revenue increased slightly to 11.9% (2023: 11.7%). Other operating expenses, including advertising, promotion and selling expenses, maintenance and repair expenses, utility expenses and other expenses, decreased by 2.4% year-on-year and the ratio of other expenses to revenue was 12.8% (2023: 12.2%).

Hong Kong Operations

During the Year, Hong Kong’s economic performance remained weak. The pace of recovery in total consumption expenditure of tourist was slower than expected, and this, coupled with the increasing number of Hong Kong residents traveling north to spend, has dampened the desire of local residents to spend money locally. Consequently, Hong Kong's retail sector has been affected. In view of this, with the help of effective marketing strategies and product optimization, the Group enhanced the sales performance of its private brands such as TOPVALU, HÓME CÓORDY and PEACE FIT WARM/COOL. Based on in-depth analysis of consumer demand, the Group launched a number of fashionable and high-quality products, which helped enhance brand awareness and drove sales growth.

In terms of store network, the Group r opened the first AEON STYLE store - AEON STYLE Tsuen Wan in the New Territories through renovation and upgrading, launching a Mono Mono store in North Point, and introducing AEON STYLE Kai Tak in Kai Tak, to provide customers with a richer range of lifestyle options. In addition to opening three KOMEDA’S Coffee branches in Tsuen Wan, Kai Tak and Kornhill, the Group opened the world’s first Japanese takeaway shop JELYCO DO By KOMEDA’S Coffee in Tsing Yi, to diversify its F&B offerings. Since opening, the new stores have been well-received by customers, with sales performance exceeding initial projections.

To sustain its performance, the Group optimized overall internal management during the year. Regarding the stores, the Group carried out reforms involving store decoration, renovation and opening costs, effectively reducing related expenses. In addition, the Group also actively promoted and applied electronic equipment, such as introducing Electronic Price Tag in three stores and supermarkets, streamlining work processes. The utilization rate of the Self-checkout system in stores increased to 55%, which not only improved employees’ work efficiency, but have also enabled the Group to more accurately grasp market dynamics and consumer needs. By strengthening management, process optimization and control of recurring expenses, the Group was able to reduce various operating expenses and it improved staff productivity through structural reform and training.

During the year, revenue from Hong Kong operations for the year declined by 9.5% to HK$3,746.0 million (2023: HK$4,140.9 million). The segment incurred loss of HK$288.2 million (2023: loss of HK$150.0 million).

Mainland China Operations

The Mainland China consumption and the real estate market remained sluggish,dragging down overall economic recovery. During the year, the Group actively adjusted its store layout and carried out extensive revitalisation and renovation of the Guangzhou Baotai Store and Guangzhou Taiyangcheng store. It also opened two new stores - Zhongshan Fuyicheng store and Guangzhou Baixin store. The sales performance of both stores met expectations, injecting new vitality into the Group's business expansion.

In terms of merchandise strategy, the Group analysed past data and focused on promoting key product categories, as a result, those products maintained strong growth with sales exceeding the levels of the same period last year. In addition, the Group was committed to developing new products. These products performed well in the market and met at ease sales and gross profit expectations.

The Group vigorously promoted digitalisation to improve operational efficiency. In the O2O realm, for example, it implemented online and offline integration to enhance customers’ consumption experience and reduce marketing costs, reaping the initial benefit of digital transformation. The Group's own e-commerce platform also made significant progress, boasting an improved sales mix proportion, giving online business stronger yet competitiveness. In addition, the Group actively expanded income from tenants and achieved its budget target by optimising its leasing strategy and improving service quality. Income from tenants exceeded the level of the same period last year.

Revenue from the Mainland China operations for the year was HK$4,349.3 million (2023: HK$4,552.0 million), a drop of 4.5% year-on-year. Mainland China business recorded loss of HK$65.9 million (2023: loss of HK$61.5 million).

Prospects

Regarding the Hong Kong operations, the government has recently introduced a series of measures, such as organizing a cluster of mega events to attract more visitors, perfecting tourist visa policies, strengthening exchange and cooperation with mainland China, upgrading urban infrastructure and raising public service standards, all of which have provided strong impetus for recovery of the retail and tourism industries. The Group will step up promotion of popular product categories that possess growth potential, and boost the sales mix proportion of those products and its own brands. At the same time, the Group will open more small specialty stores, mainly represented by Mono Mono, which are expected to yield higher return on investment.

In addition, the Group will continue to ramp up investment in the e-commerce sector and continue to hasten digital transformation. It will also gradually introduce an AI loss prevention  system in its Hong Kong stores, and conduct trial of smart shopping carts in selected stores to enhance customers’ shopping experience and the safety of store operations. The Group will continue to expand the application of Electronic Price Tag and increase the utilization rate of Self-checkout system and automatic cash handling system, so as to provide greater convenience to customers and also boost its own operating performance with technology.

Moreover, the Group will conduct comprehensive reviews and reforms on existing systems, initiate structural reform projects and meticulous financial management and cost control to reduce expenses and raise operational efficiency and productivity.

Regarding the Mainland China operations, in response to the dynamic market environment and challenges, the Group is dedicated to improving its competitive edge. In addition to the above strategies, the Group will continue to build and optimise core sales areas, such as trendy play, fruit, bakery, and pet sales areas to boost the appeal of the stores. Furthermore, the Group plans to open eight new stores in the GBA in 2025, including stand-alone supermarkets in Guangzhou, Foshan, Shenzhen and Jiangmen to meet the diverse needs of local consumers. It will also push to increase income from and foster win-win development with tenants by improving tenancy structure and tenant service quality.

Mr. Takenori Nagashima concluded, “Despite factors such as global economic uncertainties and geopolitical tensions will continue to affect the market environment, the easing of the global monetary environment, coupled with the proactive measures taken by the Mainland China and Hong Kong governments to stimulate domestic consumption, bode well for the recovery of the retail industry. The Group will actively seize opportunities an continuously make customer-centric innovations. By providing high-quality products and services, we aim to elevate customers’ sense of anticipation of AEON. At the same time, we will actively carry out business reforms in response to market changes, continuously enhancing the competitiveness of the AEON brand, and striving to become the preferred retailer for all customers in the region.”

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About AEON Stores
AEON Stores was established in Hong Kong in 1985 and listed on the Hong Kong Stock Exchange in 1994. The Group is mainly engaged in the operation of general retail businesses (General Merchandise Stores and Independent Supermarkets). Currently, it operates 10 GMS, 3 independent supermarkets, 30 independent Living PLAZA by AEON, 30 independent DAISO Japan, 4 Mono Mono, 6 KOMEDA'S Coffee and 1 JELYCO DO By KOMEDA'S Coffee in densely populated districts in Hong Kong. It also operates 21 GMS and 17 independent supermarkets in Guangdong Province, the PRC.

For more information：
AEON Stores (Hong Kong) Co., Limited
Corporate Communication Department
Tel.：（852）2165 0777
Email：aeonpr@aeonstores.com.hk