Despite inflationary headwinds and absence of EPF withdrawals, Sunway Malls sales performance beat expectations and registered 19% growth for Q1 2023 year-on-year on the back of a stronger festive quarter and healthy demand for out-of-home dining. 

The mall group operator with seven physical malls and one digital mall saw its sale performance came in above expectations with sales growth at 12% in January, 25% in February and 22% in March respectively.

Commenting on the performance, HC Chan, CEO of Sunway Malls & Theme Parks said “Certainly, Sunway Malls is off to a good start with a strong Q1 providing a strong footing for the remaining quarters. And this is achieved without the liquidity infusion from EPF easing.”

For the record, the retail industry had benefitted from the RM150billion EPF withdrawals over the last two years which provided stimulus to the industry.

“Certainly, this large scale liquidity which was bigger than the individual GDP of 100 countries and once-in-a-life booster was unprecedented. It is unlikely to be repeated,” added Chan.

For the mentioned quarter, Sunway Malls’ 19% sales growth y-o-y was largely driven by high growth from the travel related, entertainment, fashion, beauty, F&B, health & personal care categories.

As international borders opened up, pent-up demand and an uptick in travel saw the travel related category grew the highest at 178% among Sunway Malls’ retail categories.

Large blockbusters, more movie releases and healthy demand for leisure pushed entertainment up by 52%.

The beauty as well as health & personal care categories saw an improvement of 21% respectively while fashion category registered 24% up from a year ago.

Within the fashion category, better than expected performance by men fashion saw a growth of 94%. Footwear also performed well with a growth rate of 34%. Others commendable growth were unisex fashion at 27%, bags at 26%, children wear at 25% and ladies fashion at 24%. The performance was largely attributed to strong festive buying.    

Similarly, in the F&B category, demand for out-of-home dining and premium dining accelerated growth for family dining with an uptick of 40% while casual dining came in with 20% growth.

“There has been a breakthrough as F&B category now emerges as one of the Top 20 sale categories in Sunway Malls, which was previously dominated by non-F&B categories,” shared Chan. 

This is in tandem with the growing dominance of F&B categories in recent times whereby it occupies 25% -30% of the total nettable area. This trend is expected to move further heading to 35% - 40% in the near future.

In line with the growing importance of F&B, Sunway Malls has in its pipeline as well in its current portfolio a host of F&B casual dining & family dining brands that include Pokok, Serai, Tujoh, Ah Yum by Kampong Kravers, Me’nate Steak House and others to cater to the increased demand.

The mall group operator takes cognizance several key headwind themes prevailing – inflationary pressure, labour market shortage, global supply chain disruption, interest rate and tariff hikes, climate change, amongst many others which continue to drive business costs up and weigh heavily on margin and profitability for the remaining of the year.

However, it remains optimistic given its proven track record, strong branding and network of retail partners.

In spite of the current and future headwinds, Sunway Malls continues its expansion mode with development of more retail space. The mall group will undergo 800,000 sqft retail space AEI (Asset Enhancement Initiative) exercise in Sunway Pyramid and Sunway Carnival. Sunway also announced plans to build a mall with a retail space of 1 million sqft in Sunway City Ipoh which is expected to be completed by 2025.

About Sunway Malls

With 7 retail developments under its belt, Sunway Malls is gearing to be amongst Malaysia’s largest mall owner-operator. The entirety of established malls and pipeline projects currently stand at 7.7 million square feet (sq. ft.) of net lettable area (NLA). The malls are strategically located in key urban markets to serve the surrounding community.

The mall locations are: -

• Sunway Pyramid, Sunway City Kuala Lumpur
• Sunway Velocity, Cheras, Kuala Lumpur
• Sunway Carnival, Seberang Jaya, Penang
• Sunway Putra, Kuala Lumpur
• Sunway Big Box, Sunway City Iskandar Puteri, Johor
• Sunway Giza, Sunway Damansara, Selangor
• Sunway Citrine, Sunway City Iskandar Puteri, Johor

Upcoming mall locations are: -

• Sunway Square, Sunway City Kuala Lumpur, Bandar Sunway
• Sunway Pier, Port Klang, Selangor
• Sunway Ipoh Mall, Sunway City Ipoh