Bahrain Duty Free Shop Complex (BDFSC) has reported first quarter consolidated sales down by 12% on 2008 and says that loss would have been minus 6% but for the loss of the Gulf Air inflight
contract and cancelled holiday charter flights.
BDFSC adds that departing passenger numbers showed a 1% decline in the quarter against the corresponding period in 2008. At the same time, consolidated net profit after adjustment for investments was -4.6%. But without investment 'impairment' the actual net profit was +1.7% versus 2008 actual, while the actual net profit as a percentage grew by 1.7% versus 08 actual.
The retail company said that the categories that performed well over 2008 figures were liquor +2.6%; communications +16%; jewellery +14%; food and confectionery +3%; reading and writing +12.5%; Souvenirs +26%; and cosmetics +2.5%. On the negative side, the tobacco and perfume categories were both down 7% compared with the first quarter of last year.
BDFSC said the drop in these categories reflects fewer UK passengers from the cancelled charter flights and the unfavourable sterling exchange rates. At the same time, it reports that the watches category was the hardest hit.
All categories together were down by 25% in the first quarter of 2009 compared with the last quarter of 2008, with premium luxury goods sales falling most markedly as travellers reined in their spending levels.
In a statement, the company said: ‘The new sunglass area opened in February has already seen sales soar by 300%, while the improvements in sports and travel layout are now also showing significant sales increases. BDF has also witnessed its KPIs indicate some very positive news as its penetration percentage increase by another 2% points and the number of transactions increase +8% in Departures and +9% in Arrivals.
‘The continuing layout changes and expanded areas have all had a positive impact on category sales. The reworking of the 'sense of place' souvenir area (+25% growth) will begin in the second quarter, as will a review and fine tuning of arrivals shop layout and the expansion of our A-Z shop at Land side. The relocating of the popular car draw promotional site and a high profile 'promotional' area are also in the planning stage and hopefully will be completed within the 2nd quarter also.
‘Our new web site www.bdutyfree.com is now up and running since the end of December allowing customers purchase/pre-order on line via credit cards facility. Items can be collected in arrivals or departures. With 980,000 hits in the first quarter, this is proving a very popular tool for our customers and another avenue to target and drive additional business.
‘To help support this BDF is further investing in upgrading their IT system which will fully support its on line sales & inventory management and allow ‘LIVE’ ticket number selection and printing of tickets on line and at the airport.’
BDFSC added that Bahrain Air In-flight Duty Free is also doing well with a fleet now comprising four aircraft, with plans for additional aircraft in May. This is a superb low cost airline operating out of Bahrain, and one that puts inflight duty free to the forefront of its business model, offering great support to BDFS in driving sales which are already SPH double Gulf Air's. BDF & Bahrain launched its new brochure in April with a number of exclusives.’
Meanwhile, Bahrain Duty Free has signed two new agreements which should result in incremental sales. One involves the new Cruise Line Terminal at the new Hidd Port in Bahrain which is due to commence operations from June 1, 2009. The other agreement covers two small US Navy Base shops in Bahrain.
The company says that its 2009 focus will clearly be upon customer service and care, plus innovation in products and promotions to ensure 'a better experience all round', for its customers.
At the same time it should also be mentioned that Bahrain Duty Free was voted 'Best Duty Free in the Middle East & North Africa' during the recent 6th annual Middle East & North Africa travel awards. was announced that Bahrain Duty Free ‘Best Duty Free in the Middle East & North Africa’, as an acknowledgment of outstanding achievement in the services quality.
BDF General Manager Steve O'Connor said it was particularly gratifying to receive this award since it is based on votes by customers, and especially given the strong competition the company also faces from other duty free operations in the region.