WILCON Depot Inc., a retail chain selling home items and construction supplies, will become the year’s first listing at the Philippine Stock Exchange (PSE) as the company hopes to become public by March 31.
Wilcon has already secured approval from the Securities and Exchange Commission to list at the PSE. The PSE’s board is expected to have its meeting on Friday and may approve Wilcon’s P8-billion initial public offering (IPO).
William Belo, Wilcon Depot chairman and founder, said after the PSE’s approval, it will meet with its underwriter to finalize the listing, including IPO price, road show and listing schedules.
“We will not have international buyers; all our buyers will come from the domestic market. I think there’s enough demand. We received very good feedback [from interested investors],” Belo said at the sidelines of its news briefing on the company’s partnership with WorldBex.
Its road show will start after its investors’ briefing scheduled on March 7.
Wilcon earlier this year filed its application for an IPO, hoping to raise as much as P7.9 billion.
The company’s prospectus filed with the SEC said Wilcon intends to sell around 1.39 billion primary shares at P5.68 per share.
Net proceeds of the IPO will be used to fund its expansion activities, refinance existing debt obligations and for other general corporate purposes.
The company is set to increase the number of its stores this year by an additional eight branches as it rides on the country’s economic growth.
The company normally expands its branches by an average of three to four stores per year, but it wants to further capitalize on the growing Philippine economy as it tries to grow at a faster pace.
Belo said the company is expanding by an additional 27 more stores in five years. Wilcon would need around P5 billion for that number of stores, which will have a store area of around 100,000 square meters.
“We are focusing more on the Visayas and Mindanao. This year we are having Bacolod, Cagayan de Oro, Iloilo, Silang, here in Manila and then we have Cabanatuan and General Trias,” Belo said. “We’ve been continuously expanding in the past. We’ve started the store concept in 2003. We’ve been continuous with our expansion. In the past few years, it’s been growing a lot. Everyone is bullish about the economy. We want to capitalize on that. The normal pace we have is three branches a year because of the financial consideration. You get into an IPO and you have a bigger chance of doing it faster,” he said.
The company said it is aiming to increase its sales by 15 percent this year and its income by 10 percent.
Mark Belo, the company’s chief finance officer, said the company’s unaudited income last year would have increased by as much as 80 percent after reaching “north of P900 million”, from P538 million in 2015.
Net sales in 2015 reached P14.45 billion.
The company’s prospectus said 81 percent of the proceeds, or about P6.08 billion, will be used for store- network expansion, P1 billion for debt repayment and the rest for general corporate purposes.
Wilcon said it will pay its various loans with several local banks, including Allied Bank, Banco de Oro, Bank of the Philippine Islands and Rizal Commercial Banking Corp.
These loans were used to fund the company’s capital expenditures over the years, it said.
Worldbex, the Philippine World Building and Construction Exposition, will be held by the middle of the month to be held at three sites: World Trade Center, Philippine Trade Training Center and SMX Convention in the Mall of Asia in Pasay.