Maltese retail giant PG Group sees further scope for growth in the supermarket space and would consider a similar investment to PAMA and PAVI if the opportunity were to arise.
In an interview with The Malta Business Observer, Charles Borg, CEO of PG Group said that if an opportunity were to present itself for a third supermarket, the board would be open to investing in it, provided that it was a sustainable and responsible investment that matched the level of the Group’s existing establishments, and would allow the Group to continue providing adequate returns to its shareholders.
Mr Borg also said that the company had invested significantly in the PAVI supermarket village this year to bring it up to the level of PAMA, an investment programme which is expected to continue in 2019.
Mr Borg spoke about the Group’s recent purchase of the defunct Macaroni Factory in Marsa, saying that while it was a sensible property investment, the Group was happy to hold on to it until the right moment presented itself, adding that the purchase was being financed easily through PG’s day-to-day cash flow.
Besides its thriving supermarket business, PG Group holds the franchise to the Inditex-owned Zara and Zara Home brands in Malta, and Mr Borg discussed the expansion and refurbishment of the Zara flagship store in Sliema, which is set to become the largest and most modern store of its kind in Europe. The goal for the store to re-open, after closing in mid-July, has been set for 28th November.
Mr Borg said the investment had been undertaken with the full support of the board, and that the company expects to quickly offset the impacts of the store’s temporary closure through the store’s improved returns.
Mr Borg also brought up the local popularity and success of the Zara e-commerce platform, which, in Malta, is also owned by PG Group, stating that it complements the physical outlets, and was similar to having another brick-and-mortar shop. He stressed the importance of e-commerce for retail outlets, saying that even major established retailers around the world would be facing difficulties if they did not cater to the growing demographic that preferred to shop online.
While noting that the Maltese economy is going through a boom period, which was likely to remain strong for at least the next three years, Mr Borg remarked that any cycle had ups and downs, with retail being the first sector to bear the brunt of an economic downturn.
However, he confidently stated that the Group, with its supermarket offering, was diversified, sustainable, and responsible enough to withstand any economic turnaround.
This article originally appeared in The Malta Business Observer