Executive chairman Lim Kim Heng said RM49 million of the sum will be used to launch 21 new or upgraded stores this year.
The remaining RM25.3 million had already been utilised to acquire 1.17 hectares of land in Bandar Bukit Raja, Selangor, in May to support future expansion and upgrading of its warehousing and distribution network.
“We are on track to meet our 2022 store launch target as we execute our expansion swiftly to capture more opportunities amid the recovery in consumer spending,” Lim said after the company’s AGM today.
“The number of new stores for 2022 represents approximately one-third of our total 61 outlets planned for 2022 to 2024,” he added.
The latest expansion includes three refreshed retail brands, Grand senQ in Paradigm Mall Johor Baru, senQ Elite in Pavilion Elite Bukit Jalil, and Grand Senheng Elite in SS2 Petaling Jaya.
Lim said the group’s capex will be mainly from funds raised via its recent initial public offering and complemented by internally-generated reserves and bank borrowings.
He expressed confidence that the group could increase its market share in the consumer electronics retail sector to 30% in 2025 from 13% in 2020.
Lim also revealed that within the next three years, Senheng will focus on the Malaysian market rather than venture into other countries.
On sales growth, he said since the government lifted the movement control order and border restrictions, the group saw a spike in sales.
“At this moment, around 90% of sales are transacted in physical stores. Malaysians love shopping at the stores, to feel the products, look at the colour and more importantly, they want one-on-one consultation,” he said.
Lim said it is possible for the group to achieve double-digit growth in the second and third quarters of financial year 2022 based on its current sales trend and an expected improvement in consumer spending.
For the first quarter of FY2022, its net earnings decreased 26.2% to RM12.06 million from the same quarter last year. The lower net profit recorded for the quarter was due to higher operating and administrative expenses.