The supermarket chain entered the stock market with an ambitious expansion strategy backed by one of the country’s largest property groups. Four years later, the financial statements tell a very different story.
Growth stories rarely unravel overnight. More often, they weaken quietly, one financial statement at a time.
When AllDay Marts (PSE: ALLDY) listed on the Philippine Stock Exchange in 2021, investors were buying into more than a supermarket chain. The company offered a compelling proposition: combine modern grocery retailing with the Villar Group’s expanding network of residential communities and lifestyle malls. Every new township represented another potential supermarket, while every new mall created another source of customer traffic. Expansion was expected to drive sales, improve purchasing power, and ultimately deliver stronger earnings.
By the end of 2024, AllDay had expanded to 40 stores across the country, supported by approximately 60,000 square meters of selling space. On paper, the physical footprint continued to grow. Financially, however, the business was beginning to tell a different story.
The company is now suspended from trading after failing to submit its 2025 audited financial statements and first-quarter 2026 report. Yet the latest available financial statements suggest that the suspension was not the beginning of AllDay’s problems. Instead, it appears to have been the latest chapter in a slowdown that had already been developing.
Growth Stopped Translating Into Higher Earnings
The first signs appeared in the 2024 annual report. Revenue declined 9.2 percent to ₱9.25 billion, while net income fell a much steeper 27.4 percent to ₱268 million. The wider decline in earnings suggested that the company’s expanding store network was no longer generating the same level of profitability. Management attributed the weaker performance to lower sales from several stores and a more competitive operating environment.
This is important because a retailer can survive a temporary slowdown in consumer spending. But when profits decline three times faster than sales, it usually means the existing cost structure is becoming harder to support.
Based on the disclosed store network, average annual sales worked out to roughly ₱231 million per store, which raises an important question: had the focus shifted from opening stores to improving the productivity of the stores already in operation?
The Balance Sheet Raised The First Warning
The income statement showed slowing growth, but the balance sheet revealed a more fundamental change. Even as sales declined, merchandise inventory increased 35.5 percent to ₱2.82 billion, while advances for purchases climbed to nearly ₱1 billion. Instead of generating more cash, the business was tying up increasing amounts of capital in inventory and supplier advances. At the same time, operating cash flow turned negative despite the company remaining profitable.
Cash on hand actually increased to ₱1.49 billion at the end of 2024, but the cash flow statement explains why. The improvement came largely from additional borrowings rather than internally generated cash. Loans payable increased to ₱2.89 billion, which indicates that external financing was supporting liquidity while the core retail business struggled to convert profits into cash.
These developments did not necessarily indicate financial distress, but they suggested that the company’s expansion strategy was becoming increasingly capital intensive.
2025 Exposed The Cracks
If the 2024 financial statements hinted that momentum was fading, the third-quarter 2025 report suggested the deterioration had accelerated.
Revenue for the first nine months plunged 44.9 percent to ₱3.91 billion. Operating profit fell almost 89 percent, while the company reported a ₱87 million net loss, reversing the ₱224 million profit recorded during the same period a year earlier.
Perhaps even more concerning was the cash position. Cash declined from ₱1.49 billion at the end of 2024 to only ₱152 million by September 2025. Although the company reduced outstanding borrowings during the period, it also spent approximately ₱773 million on property and equipment while generating only ₱158 million of operating cash flow. Finance costs also climbed to ₱130 million, nearly four times the previous year’s level, which leave operating earnings increasingly consumed by interest expense.
Meanwhile, merchandise inventory remained at approximately ₱2.77 billion, barely lower than year-end levels despite the sharp decline in sales. The financial statements therefore suggest that inventory productivity weakened significantly as the business slowed.
From Expansion To Stabilization
One disclosure may best illustrate how management’s priorities evolved.
In November 2025, AllDay’s board approved the reallocation of its remaining IPO proceeds to working capital. Around the same time, the company disclosed that it was evaluating its retail network to streamline and optimize store operations.
Those decisions suggest that the conversation had changed. The company was no longer focused primarily on opening more stores. It was increasingly focused on improving liquidity and strengthening the existing business.
The Next Chapter
AllDay still possesses important competitive strengths. It operates a nationwide supermarket network, enjoys strategic locations within the Villar ecosystem, and benefits from the support of one of the country’s largest property groups.
The financials, however, suggest that the company’s next phase will depend less on expansion and more on execution.
Can existing stores return to sustainable sales growth? Can working capital become more efficient? Can operating cash flow consistently fund capital spending? Most importantly, can management restore investor confidence by resuming timely financial reporting?
The original investment thesis was built on expansion. The next one may depend on something far more fundamental which is to prove that the stores already built can once again generate profitable and sustainable growth.
