Moneymax’s 1Q19 net profit dropped 51 percent on accounting changes, finance costs

MoneyMax outlet in Singapore’s Little India neighborhood; taken October 2018.MoneyMax outlet in Singapore’s Little India neighborhood; taken October 2018.

Moneymax reported Tuesday its first quarter net profit dropped 50.6 percent on-year to S$1.04 million amid accounting changefor leases and higher finance costs.

Revenue for the quarter ended 31 March rose 6.6 percent on-year to S$39.81 million on higher contributions from the retail and trading of pre-owned items segment and the pawnbroking segment, the pawnbroker said in a filing to SGX.

Material costs increased 9.1 percent on-year to S$27.6 million in the quarter on increased revenue from the retail and trading of pre-owned items segment, Moneymax said.

Other losses increased 274.1 percent on-year to around S$202,000, mainly from the disposal of fixed assets from rationalizing and closing outlet locations, it said.

Depreciation and amortization expenses surged to S$3.08 million in the first quarter, from S$683,000 in the year-ago period on the depreciation of leases on changes in accounting methods, Moneymax said.

Finance costs rose 41.5 percent on-year to S$1.94 million in the quarter on the changed accounting for leases and increased use of banking facilities for operational cash requirements and an expansion into vehicle financing, the filing said.

Moneymax said it was “cautiously optimistic” on its full-year performance. “The challenges in the retail industry are expected to persist, given lackluster consumer sentiments and economic uncertainties,” the pawnbroker said.

“The group remains committed in growing its businesses, with the aim of becoming a leading financial solutions provider, specifically, diversification into other financial services or expanding its current services to local and overseas markets so as to drive sustainable growth,” it added.

 

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