Sakae posts 63.6% drop in Q1 profit on lower revenue

Sakae Holdings' earnings for its first quarter fell 63.6 per cent year on year to $75,000 from $206,000, as streamlined operations led to lower revenue, the operator of conveyor belt sushi restaurants announced on Wednesday.

This translated to earnings per share (EPS) of 0.05 cent for the three months ending September, one-third of the EPS of 0.15 cent for the corresponding period last year.

Revenue was 36.6 per cent lower at $10.4 million, compared to $16.4 million a year ago.

The group had negative operating cash flow of $1.3 million in the first quarter, but said it would be cautious in ensuring continuous growth in operations and in managing its operating costs effectively.

On its sugar trade business that turned sour, Sakae reiterated that investigations are on-going and updates will be given when appropriate.

The company announced in September that its auditors had questioned the validity of certain commodity trade transactions. It has since made a police report.

Owing to intense competition in the food and beverage industry, coupled with acute labour shortage, the group foresees operating conditions to be challenging as labour, rent, utilities and food costs are expected to keep rising in the next 12 months.

The counter was last traded on Nov 2 at 15 cents.

A version of this article appeared in the print edition of The Straits Times on November 16, 2018, with the headline 'Sakae posts 63.6% drop in Q1 profit on lower revenue'. Print Edition | Subscribe