欧博开户网址:Convenience store players to feel the pinch
For 7-Eleven Malaysia Holdings Bhd, every 10% decline in tobacco sales would lower the group’s total revenue by 2.2%, assuming tobacco sales make up 35% of its CVS segment sales, according to the research house’s estimates.欧博开户网址（www.allbet8.vip），欧博网址开放会员注册、代理开户、电脑客户端下载、苹果安卓下载等业务。
PETALING JAYA: The government’s proposed bill to ban the sale of all tobacco products, including e-cigarettes, to people born in and after 2007 in a bid to curb smoking, will negatively impact sales of Malaysia’s convenience store (CVS) players.
The Tobacco and Smoking Control Bill 2022 was first tabled to the Dewan Rakyat on July 27. The bill will be tabled in the next parliamentary meeting scheduled to start on Oct 26. In addition to the ban of tobacco sale for people born in and after 2007, the bill also prohibit retailers from displaying tobacco products, smoking devices as well as their substitutes.
CGS-CIMB Research stated if the bill were to be approved, local CVS players would not be able to display tobacco products and smoking-related items in their stores, which could hurt their tobacco sales.
“Based on our channel checks, tobacco sales form 7% to 35% of CVS operator’s sales at this juncture.
“Nevertheless, we expect the impact on margins and bottom line to be smaller,” it said, given cigarettes are typically a low-margin sales product.
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The research house, in a report last Friday, stated a sensitivity analysis to gauge the impact of every 10% decline in tobacco sales to its revenue forecast for the CVS players, found QL Resources Bhd would be least impacted due to its well diversified business model and lowest revenue contribution from tobacco products among its peers.
Every 10% decline in tobacco sales would lower QL Resources’ total revenue by 0.1% only, assuming tobacco sales make up 6.6% of its CVS segment sales.
For 7-Eleven Malaysia Holdings Bhd, every 10% decline in tobacco sales would lower the group’s total revenue by 2.2%, assuming tobacco sales make up 35% of its CVS segment sales, according to the research house’s estimates.
However, the impact on 7-Eleven’s revenue will partly be cushioned by its pharmaceutical business segment.
MyNews Holdings Bhd would be impacted the most as CGS CIMB’s Research analysis revealed that a 10% decline in tobacco sales would lower the group’s total revenue by 3.5%, assuming tobacco sales make up 35% of its sales, and given that it generates 100% of its revenue from the CVS business.
CGS CIMB added that 7-Eleven generated 62% of its first quarter revenue for financial year 2022 (1Q22) from its CVS business and QL Resources, via Family Mart, generated only 13.4% of its FY22 revenue.