Tuesday, March 23, 2010

RHB Equity 360° (Consumer; Technical: Kurnia Asia) - 23/03/2010

- While we reckon that the impact to retailers would be marginal, we illustrate the following changes to retailers’ profit and loss: 1) Own customer loyalty programme. In the case of a retailer supplying the award credits itself (such as AEON), there would be an initial reduction in the stated revenue i.e. part of the revenue from award redits would now be recognised as deferred revenue. Impact to AEON’s topline and bottomline is minimal; and 2) Third party customer loyalty programme. In the case of a retailer with third party customer loyalty programme (such as Parkson Malaysia), the retailer is treated as an agent and is merely collecting the award credits on behalf of a third party and as such, would have to allocated part of its revenue payable to the third party. No impact to Parkson’s topline and bottomline.

RHB Equity 360° (Consumer; Technical: Kurnia Asia) - 23/03/2010

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