Sheng Siong Group posts Q3 earnings of $9.81m

Sheng Siong Group posts Q3 earnings of $9.81m

SHENG Siong Group posted a third-quarter net profit of $9.81 million, up 48.1 per cent from the preceding corresponding period's $6.63 million, which took into account one-off initial public offering expenses of $1.8 million.

The supermarket chain, which listed on the Singapore Exchange mainboard in August last year, reported a revenue of $169.68 million for the three months ended Sept 30 this year, up 16 per cent year on year.

This was on the back of the opening of new stores and higher comparable same-store sales, with partial offset by the closure of the Katong store.

This year, the group opened supermarkets in Toa Payoh, New World Centre, Geylang, Bukit Batok, Bedok North and Yishun Central, boosting its total retail area to about 391,000 sq ft by the end of the third quarter.

Comparable same-store sales grew 4.3 per cent year on year for the nine months, due to marketing initiatives and improvement of population numbers and profiles in mature housing estates.

Consequently, quarter-on-quarter revenue per square foot grew from $399 in Q2 to $434 in Q3.

Correspondingly, administrative expenses increased 7 per cent over the previous year to $26.6 million, due to higher manpower cost, rent, and utilities, said Sheng Siong.

Despite this, the group managed to maintain its operating margins at 7 per cent due to stringent cost control.

The group's cash and cash equivalents decreased to $107.2 million as at Sept 30 from $122.1 million as at end 2011, due mainly to the distribution of dividends, and staff bonuses.

This was offset by one-off net proceeds of $14.1 million received from the sale of the old Marsiling warehouse in Q1.

The group remained debt free as at end September.

Sheng Siong said that expanding its network across Singapore will continue to be a priority for the group.

In Q4, two new stores located at Ghim Moh and Clementi are slated to begin operation.

This will boost the group's retail area to around 400,000 sq ft. The group is also targeting to commence its pilot e-commerce initiative project in 2013.

Earnings per share for the quarter was 0.71 cent, up from 0.56 cent the year before.

The counter ended trading unchanged at 47.5 cents.

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