New World Department Store China Limited ("NWDS" or the "Company"; Hong Kong stock code: 825), one of the largest owners and operators of department stores in the PRC, announced today it would further expand its PRC portfolio to 32 stores through the addition of a new self-owned store in Anshan, Liaoning.
The new store is located at Tiedong District, the commercial hub in Anshan, and is scheduled to open in October 2007. It covers a total gross floor area ("GFA") of approximately 35,000 square metres ("sq. m."), with eight storeys designated for department store operations. With the addition of this new store in Anshan, NWDS's portfolio will increase to include 32 stores, of which 17 are self-owned stores and 15 are managed stores (inclusive of the three newly added managed stores in Beijing, Wuhan and Shanghai Pudong respectively). In addition, the total GFA of the Company's operations will reach approximately 985,000 sq. m. (inclusive of the expanded retail space in Shanghai Hongkou Branch Store).
Commenting on the new store in Anshan, Mr. Adrian Cheng, Executive Director of NWDS, said, "We believe the opening of this new store will enhance NWDS's brand reputation in north-eastern China, where we already have a strong foothold due to our presence in Shenyang, Liaoning. This is in line with one of our growth strategies of expanding our retail network through establishing new self-owned stores in prime locations that feature high pedestrian and traffic flow. With our expansion plans in place, we endeavor to become a dominant department store chain operator in China."
Mr. Philip Cheung, Managing Director and Executive Director of NWDS, added, "The opening of NWDS's new store in Anshan marks our foray into another vibrant city in Liaoning Province. Strong economic growth in the region has led to outstanding performance in Anshan's retail sales and consumption power in recent years. In 2006, retail sales in Anshan reached RMB 25.4 billion, a year-on-year growth of 14.7%, which was higher than the national average. Tiedong District, where our new store is located, outstripped the other districts in Anshan and posted strong retail sales growth of 40.7% for the first four months in 2007. As such, we are fully confident that our new store will achieve great success."
NWDS has recently entered into a 20-year lease agreement with an Independent Third Party with respect to the property site where the Anshan self-owned store is located. Subsequent to the expiry of the first 20-year lease term, the Company has the right to renew the lease term for another five years. After the five-year term is over, the Company has the first right of refusal for leasing the property.