Sakae books $6.1m loss for Q3

Sakae Holdings reported a $6.1 million loss for its third quarter from a $306,000 profit for the year-ago period, after recognising a $3.2 million goodwill impairment charge for its majority stake in a Chilean seafood trader.

It is the second consecutive quarter that the sushi restaurant operator is seeing red amid intense competition within the food and beverage industry.

The group expects operating conditions to be challenging as food, labour, rental and utilities costs will likely continue to rise in the next 12 months.

Loss per share was 4.36 cents versus earnings per share of 0.22 cent.

No dividend was declared, the same as the year before.

Revenue for the three months to March 31 decreased 0.8 per cent to $12.2 million, due to the streamlining of outlets and slow sales overseas.

Other operating expenses nearly tripled to $9.3 million from $3.2 million, due mainly to a goodwill impairment of $3.2 million and an impairment loss on other receivables of $2.8 million.

The goodwill charge was for Sakae's 51 per cent-owned Chilean frozen seafood production and trading company, Cocosa Export.

The group acquired the stake on March 6, 2016, and Sakae said on Wednesday night that the value of its investment in Cocosa Export may not be recoverable.

Despite the allowance for impairment loss on other receivables, the group said it will continue to work on its recovery.

A version of this article appeared in the print edition of The Straits Times on May 17, 2019, with the headline 'Sakae books $6.1m loss for Q3'. Print Edition | Subscribe