Sheng Siong's Q2 net profit up 6.4% to $17.1m

Supermarket chain Sheng Siong Group's net profit grew 6.4 per cent to $17.1 million for the second quarter ended June 30, up from $16.1 million a year ago, the group said yesterday after the market closed.

This was on the back of a 5.7 per cent rise in revenue to $213 million, mainly contributed by the opening of new stores - four in the first quarter and three in the last five months of FY2017 - and comparable sales from existing stores.

As of June 30, Sheng Siong had 48 stores in Singapore and one in China, compared with 42 in Singapore a year ago. The opening of two new stores in Bukit Batok and Yishun on July 13 took the number of stores here to 50.

For the second quarter, earnings per share rose 6.5 per cent to 1.14 cents, from 1.07 cents in the same quarter last year.

Sheng Siong has declared an interim cash dividend of 1.65 cents per share.

Chief executive Lim Hock Chee said: "In line with our commitment to expand our retail network across Singapore... we will stay focused but disciplined to look for new retail space.

  • AT A GLANCE

  • REVENUE: $213 million (+5.7%)

    NET PROFIT: $17.1 million (+6.4%)

    INTERIM DIVIDEND PER SHARE: 1.65 cents (+6.5%)

"Nurturing the growth of our new stores in Singapore and China, and rejuvenating the old stores remain one of our key priorities."

The China subsidiary, which began operations last November, recorded a loss of $100,000 for the first half of FY2018.

"We will continue with our efforts in lowering input cost by improving the sales mix with a higher proportion of fresh produce, and increasing labour productivity by deploying smart processes and systems," Mr Lim said.

Lower input costs, along with a better sales mix, contributed to Sheng Siong's improved gross margin of 27.3 per cent in the second quarter, compared with 26.8 per cent in the year-ago period.

Cash and cash equivalents were up by $2.2 million to $75.7 million as of June 30.

Sheng Siong's shares closed down two cents, or 2 per cent, at $1.07 yesterday.

A version of this article appeared in the print edition of The Straits Times on July 31, 2018, with the headline 'Sheng Siong's Q2 net profit up 6.4% to $17.1m'. Print Edition | Subscribe