Chilli crab icon Jumbo Group reported its fiscal full-year net profit fell 23.8 percent on-year to S$11.02 million, despite higher revenue, as its expansion increased expenses.
“As with any growing business, we are keenly aware that we are in the gestation period of our expansion, locally and regionally, which was reflected in our financial performance for the year,” Ang Kiam Meng, executive director and group CEO, said in the statement.
“Nonetheless, I am pleased that we have continued to deliver a resilient set of results, and I believe in maintaining a long-term view on our business, and to prudently balance the costs associated with our expansion plans,” he added.
Revenue for the fiscal year ended 30 September rose 5.5 percent on-year to S$153.05 million, it said in a filing to SGX after the market close on Wednesday.
That was after revenue for the Singapore operations increased by S$2.1 million in the year, while revenue from the China outlets rose by S$5.8 million, with full-year contributions from two new Jumbo Seafood restaurants in Shanghai and Beijing and four months of revenue contribution from a new outlet in Xi’an, it said.
Cost of sales, which includes raw materials and consumables, for the fiscal year increased 7.4 percent on-year to S$57.10 million, Jumbo said.
Employee benefits expense grew 13.7 percent on-year to S$47.50 million, mainly a larger workforce for the new outlets in China and increased headcount in the Singapore and China corporate offices to support the expansion, Jumbo said. Other operating expenses rose 16.1 percent on-year for the fiscal year to S$15.66 million, mainly on the increased number of outlets and the corporate office expansion, it said.
Jumbo declared a final dividend of 0.7 Singapore cent, compared with 0.5 Singapore cent final dividend and a 0.7 Singapore cent special dividend in the year-ago period.
For the fiscal second half, Jumbo reported net profit of S$4.65 million, down 22.5 percent on-year, on sales of S$75.55 million, up 3.5 percent on-year.
Jumbo said it planned to pursue its expansion strategy.
“In line with its strategy of expanding its F&B business through the opening of new outlets, joint ventures and strategic alliances with partners, the group will continue to explore suitable opportunities to strengthen its competitive edge in its existing business and solidify its market position in the region,” it said.
Jumbo said it plans to open two new Jumbo Seafood restaurants, one new Teochew cuisine restaurant and at least two more Tsui Wah Cha Chaan Teng outlets in Singapore over the next 12 months.