Sheng Siong profits up 6.6% to $37.8m in H1

The supermarket opened 13 new stores in Q2, boosting revenue.

Supermarket chain Sheng Siong Group’s profits jumped 6.6% YoY to $37.8m in H1 from $35.4m, an announcement revealed. Revenue for the same period climbed 11% YoY to $449.6m from $441.3m previously.

In Q2, profits rose by 7.4% YoY to $18.4m from $17.2m last year, whilst revenue rose by 11.8% YoY to $238m from $213m.

Also read: Sheng Siong's profits jumped 5.9% to $19.36m in Q1

The growth in profit was attributed to higher revenue, slightly improved gross margin, and higher other income, although it was partially offset by higher operating and net interest expenses. The adoption of the Singapore Financial Reporting Standard 116 Leases (FRS 116) reduced the Group’s H1 net profit by $1m compared with H1 2018, the financial report added.

The addition of 13 new stores drove revenue growth in Q2. However, it was partially offset by store sales contracting by 0.3 percentage points, which Sheng Siong said may be due to cautious consumers’ sentiments.

Also read: Sheng Siong's new-store strategy may fall flat as consumer sentiment sours: analyst

Distributable income increased by 6.5% YoY to $37.8m in H1 from $35.5m, whilst earnings per share grew 6.4% YoY to $0.0251 from $0.0236 previously. For Q2, distributable income also recorded a growth of 6.9% YoY, and earnings per share went up by 7.9% YoY. The group’s balance sheet reportedly remained healthy with cash of $82.9m as of June 30.

“We are delighted to open three new HDB shops at Bukit Batok Block 292, Anchorvale Road Block 351 and Sumang Lane Block 231 in May 2019, expanding our total retail square footage in Singapore to 512,000 sqft and increasing our store count to 57,” said Lim Hock Chee, chief executive officer.