PT Matahari Department Store Tbk (“Matahari” or “the Company”; stock code: “LPPF”) today reported gross sales of Rp 5.9 trillion for the nine months ended September 2020, 57.6% below same period last year, whilst net revenue was down 57.5% to Rp 3.3 trillion.

Matahari was recovering steadily in July and August and until mid-September when, on 14 September, large scale social restriction (PSBB) was implemented again in Jakarta and operating restrictions were experienced in other locations. This resulted in Matahari closing some of its stores temporarily, and slowed down its overall performance for the quarter. To mitigate the pandemic impact, the Company took stringent cost actions, including negotiating rental waivers and discounts, which has resulted in a 26.2% operating expenditure decrease for the third quarter and 29.3% for September YTD. Nevertheless, Matahari recorded a net loss of Rp 617 billion for the nine months ended September 2020.

The ongoing COVID-19 pandemic has accelerated the closure of underperforming stores in line with Matahari’s efforts to restructure its business. This year seven large-format and all specialty stores were closed; and three large-format stores were opened. Matahari currently operates 153 stores in 76 cities across Indonesia, and the Company intends to end the year with a portfolio of around 150 profitable large-format MDS stores.

Terry O’Connor, CEO and Vice President Director of Matahari said, “All of our recovery plans are on track however our steady footfall increase was interrupted by PSBB in September 2020. Our stores continue to uphold our 5-Star Pledge, and serve customers well with strict health protocols. We have repaid the additional credit facility set up during May this year. We keep a strict control over our expenses and our capex freeze is still in place other than two stores opened in the quarter. Salary cut restoration has commenced in line with our recovery, and is intended to be fully restored in Q4 2020.”