Sheng Siong H1 profit down 11.9% as grocery frenzy eases

Sheng Siong noted in its outlook statement that third-quarter demand may be higher year on year.
Sheng Siong noted in its outlook statement that third-quarter demand may be higher year on year.ST PHOTO: DESMOND WEE

SINGAPORE (THE BUSINESS TIMES) - Mainboard-listed supermarket operator Sheng Siong Group saw a more subdued first half, after the year-ago high base from a buying frenzy when the pandemic first hit.

Net profit was down by 11.9 per cent to $65.9 million, as revenue slipped 8.8 per cent to $681.7 million, according to unaudited financial results released on Thursday for the six months to June 30.

Sheng Siong noted in its outlook statement that third-quarter demand may be higher year on year, given the recent tightening of Covid-19 measures from July 22 to Aug 18.

But "the demand is likely to taper in the second half of 2021", even as government support could ease on the back of an improving Covid-19 situation in Singapore.

Otherwise, Sheng Siong chief executive Lim Hock Chee said in a statement that "our expansion plan in China is also moving forward", with lease agreements inked for two more stores that are slated to open in Kunming in the second half of the year.

Mr Lim added that the group is still looking for new retail space in Singapore "particularly in areas where we have yet to build a presence", despite tighter supply amid the pandemic that affected expansion plans.

For the six months, earnings per share fell to 4.39 Singapore cents, from 4.98 cents previously, while net asset value was $0.26 a share, against $0.25 as at end-2020.

The board declared an interim dividend of 3.1 cents a share, compared with 3.5 cents the year before. Books close on Aug 18 and payment will be on Aug 30.

Separately, Sheng Siong has named Patrick Chee to its board as an independent director. Mr Chee, 66, is senior legal consultant at Withers KhattarWong and also sits on the boards of China International Holdings, OneApex, MeGroup and QAF.

Sheng Siong shares closed down $0.01, or 0.64 per cent, at $1.56, before the announcements.