Spencer's sees Ebitda break-even soon

Company which opened stores under Spencer's brand in 2006 recorded a net loss of Rs 209.1 cr in 2012-13

There are corrections in this article.

Spencer’s Retail, part of the RP-Sanjiv Goenka Group, is set to become profitable at the earnings before interest, taxes, depreciation and amortisation (Ebitda) level in a couple of quarters, Shashwat Goenka, the group’s retail sector head, has said.

For 2012-13, the company, which set up stores under the Spencer’s brand in 2006, recorded a net loss of Rs 209.1 crore, against a loss of Rs 255.4 crore in 2011-12. In that period, Spencer’s sales rose from Rs 1,206.3 crore to Rs 1,347 crore. Earlier, the company had aimed to record Ebitda break-even in the third quarter of 2013-14.

“We have been the first to come. But modern trade is a new concept and gained traction only in the last couple of years. We are moving towards profitability,” Goenka said. “Profitability is a result of sales, Ebitda and trading area. We are finding right properties at the right prices,” he told Business Standard.

Spencer’s, which plans to open 80 stores by 2017, rolled out 11 in the past financial year. Goenka said it planned to open the same number of stores this year.

Though retailers such as Aditya Birla, Reliance and Spencer’s expanded aggressively after 2006, they were forced to shut loss-making stores.

Correction: this article earlier wrongly mentioned the current net loss at Rs 2,091 crore and the year-ago net loss at Rs 2,554 crore. Also, the current sales were wrongly mentioned as Rs 12,063 crore and Rs 13,470 crore in the year-ago period. The error is regretted.