Profits down for food caterer Neo Group on higher expenses

Chefs working in a kitchen, one of the four central kitchens by food caterer Neo Group. -- PHOTO: NEO GROUP
Chefs working in a kitchen, one of the four central kitchens by food caterer Neo Group. -- PHOTO: NEO GROUP

SINGAPORE - Food caterer Neo Group has posted a 9.1 per cent decline in its net profit for the six months ended July 31 from the previous year, as expenses rose more quickly than revenue.

Revenue rose 21.2 per cent to $28 million for the period, on higher sales in the Catalist-listed group's food catering and food retail businesses.

But costs such as employee benefits, depreciation and amortisation, advertising and operating lease expenses increased more steeply. As a result, net profit fell to $2.5 million for the six-month period to July 31, from $2.8 million a year ago.

The group's founder, chairman and chief executive Neo Kah Kiat said demand for Neo Group's services has grown due to new menus, brands and concepts being introduced.

Over the last few months, the group has launched three new brand concepts - Best Catering, Issho izakaya and Nanami Udon - and has also added new menus under its existing brands Neo Garden, Orange Clove, Deli Hub and umisushi.