Financials

CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS AND FULL YEAR ENDED 31 MARCH 2024

Financials Archive

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Condensed interim consolidated statement of comprehensive income for the six-months and full year ended 31 March 2024

Condensed interim statement of financial position

(A) Statement of Comprehensive Income

2H2024 vs 2H2023

For the period from 1 October 2023 to 31 March 2024 (“2H2024”), the Group’s revenue increased by approximately S$4.6 million or 10.0%. This increase in revenue arose mainly due to higher retail, delivery, catering and non-retail sales.

Revenue from retail outlets increased by approximately S$3.5 million or 8.3% mainly due to incremental revenue from new outlets and an increase in revenue from existing outlets, partially offset by a decrease in revenue from closed outlets. The number of new outlets matched outlet closure during the financial year. As at 31 March 2024, the Group operated a total of 79 outlets in Singapore (31 March 2023: 79 outlets).

Revenue from other services, such as delivery, catering services and non-retail sales, increased by approximately S$1.1 million or 24.4%. The increase arose primarily due to higher delivery revenue, corporate catering orders and non-retail sales, with the continued pick-up in events being organised in the second half of FY2024.

The Group’s gross profit margin increased by 4.2% to 68.7% in 2H2024, mainly due to improved cost management, product pricing management and lower production depreciation expenses as a percentage of revenue due to the higher revenue generated for the current period.

Other income increased by approximately S$0.4 million due to higher employment grant income of approximately S$0.4 million and higher government grant income of approximately S$0.1 million, which was partially offset by lower gain from disposal of motor vehicle of approximately S$0.1 million for the current period.

Interest income increased by approximately S$0.2 million due to higher interest rates on short-term fixed deposits.

The increase in selling and distribution (“S & D”) expenses had arisen due to higher staff costs, advertising and promotion, depreciation of right-of-use assets and turnover rental expenses during 2H2024. As a percentage of revenue, total S & D expenses increased slightly from 39.0% to 40.0%.

The increase in administrative expenses was attributable to higher staff costs and benefits including higher bonus provision arising from the increase in profit for 2H2024, bank charges and other maintenance expenses, partially offset by lower computer and software maintenance expenses for the current period.

Finance costs increased slightly by approximately S$0.2 million mainly due to higher interest rates on finance leases and bank loans.

Other expenses decreased by S$0.2 million mainly due to lower depreciation expenses and impairment loss on amounts due from joint venture, and lower foreign exchange loss pursuant to foreign exchange revaluation of inter-company loans to the Group’s Australian and Malaysian subsidiaries for the current period, partially offset by higher impairment loss of right-of-use assets for retail outlets.

The increase in depreciation expenses was mainly due to an increase in depreciation of right-of-use assets mainly for new and renewed leases of retail outlets, partially offset by a decrease in depreciation of property, plant and equipment resulting from an increase in fully depreciated assets (comprising the Group’s property, plant and equipment).

The Group’s taxation expenses increased by S$0.7 million mainly due to the increase in revenue and lower non-tax deductible items for the period.

FY2024 vs FY2023

The Group’s revenue increased by approximately S$11.2 million or 12.4% for the financial year ended 31 March 2024 (“FY2024”), mainly due to an increase in revenue from retail outlets, catering, delivery and nonretail sales.

Revenue from retail outlets increased by approximately S$8.8 million or 10.9% mainly due to incremental revenue from new outlets and an increase in revenue from existing outlets, partially offset by a decrease in revenue from closed outlets.

Revenue from other services, such as delivery and catering services, increased by approximately S$2.3 million or 26.4% mainly due to higher catering, delivery, non-retail and events revenue during the current financial year.

The Group’s gross profit margin increased by 2.7% to 67.6% in FY2024, mainly due to improved cost management, product pricing management, and lower production utilities expenses as a percentage of revenue during FY2024.

Other income increased by approximately S$0.5 million due to higher employment grant income and higher government grants, offset by lower gain on disposal of assets during the financial year.

Interest income increased by approximately S$0.7 million due to higher interest rates on short-term fixed deposits.

The increase in S & D expenses was largely due to higher staff costs, depreciation of right-of-use assets, advertising and promotion, rental expenses, and the absence of rental rebates received from landlords, partially offset by lower outlets depreciation expenses during FY2024. As a percentage of revenue, total S & D expenses decreased slightly from 39.9% to 39.5%, mainly due to the increase in retail sales during the financial year.

The increase in administrative expenses was mainly due to higher staff costs including higher bonus provision arising from the increase in profit for FY2024, higher legal and professional expenses, bank charges, and other maintenance expenses for the current year.

Finance costs increased by approximately S$0.4 million or 54.3%, mainly due to higher interest rates on finance leases and bank loans.

Other expenses decreased by S$0.5 million mainly due to lower depreciation expenses and lower impairment loss of amounts due from our joint venture in United Kingdom (”UK”) and the Company’s Malaysian associate, lower foreign exchange loss pursuant to foreign exchange revaluation of inter-company loans to Australia and Malaysia, partially offset by higher impairment loss of right-of-use assets for retail outlets for the current financial year.

The Group’s taxation expenses increased by S$1.3 million mainly due to the higher profit for FY2024, and lower non-tax deductible items for the current financial year reported.

(B) Statement of Financial Position

Non-current assets

The Group’s non-current assets increased by approximately S$1.9 million mainly due to:

an increase in right-of-use assets arising from new and renewed leases entered into during FY2024, partially offset by right-of-use depreciation expenses and recognition of impairment loss of right-of-use assets for retail outlets; and
an increase in long term deposits arising from reclassification of lease deposits in accordance with the respective lease tenures during the current period; and deposits paid for new outlets and lease renewal; partially offset by a decrease in property, plant and equipment arising from depreciation expenses, offset by additions during FY2024.

Current assets

The Group’s current assets increased by approximately S$10.8 million, mainly due to:

an increase in cash and bank balances of approximately S$10.2 million. Further details of the Group’s cash flows are set out in paragraph (C) below;
an increase in inventories of approximately S$0.6 million, arising from bulk purchase of products from overseas suppliers; and
an increase in trade and other receivables, arising from increases in credit sales to corporate customers in line with the increase in from non-retail sales; partially offset by the following: (a) a decrease in prepayments due to recognition of expenses offset by an increase in annual insurance premium during FY2024; and (b) a decrease in short term deposits, arising from reclassification of lease deposits in accordance with the respective lease tenures and refund of deposits from closed outlets.

Current and non-current liabilities

The net increase in the Group’s current and non-current liabilities of S$5.4 million was mainly due to:

an increase in trade and other payables of approximately S$2.7 million, arising from an increase in accrued expenses and trade creditors as a result of higher sales during FY2024;
an increase in tax provision due to higher profit before tax and lower tax-deductible items during FY2024, which was partially offset by tax paid during FY2024; and
an increase in lease liabilities mainly due to lease renewal and new lease commitments offset by lease repayment during FY2024; partially offset by a decrease in liabilities pertaining to bank loans and finance leases, mainly due to repayments made during FY2024.

Net working capital

As at 31 March 2024, the Group had a positive net working capital of approximately S$23.0 million, compared to approximately S$16.8 million as at 31 March 2023.

(C) Statement of Cash Flows

2H2024 vs 2H2023

In 2H2024, the Group generated an operating profit before working capital changes of approximately S$14.0 million. Net cash generated from operating activities, inclusive of working capital changes and tax paid, amounted to approximately S$14.6 million in 2H2024.

In 2H2024, net cash used in investing activities amounted to approximately S$95,000. This was mainly due to acquisitions of motor vehicles, as well as plant and equipment, partially offset by interest income received from short-term fixed deposits for the current period.

Net cash used in financing activities amounted to approximately S$8.0 million in 2H2024. This was mainly due to dividends of approximately S$1.2 million paid during 2H2024, repayment of lease obligations inclusive of lease interest of approximately S$5.9 million, and repayment of bank loans and finance lease during the period.

FY2024 vs FY2023

For FY2024, the Group generated an operating profit before working capital changes of approximately S$26.7 million. Net cash generated from operating activities, inclusive of working capital changes and tax paid, amounted to approximately S$26.6 million in FY2024.

In FY2024, net cash used in investing activities amounted to approximately S$0.7 million. This was mainly due to additions of property, plant and equipment, and renovation work for the Group’s new retail outlets, partially offset by interest received from short-term fixed deposits in FY2024.

Net cash used in financing activities amounted to approximately S$15.7 million in FY2024. This was mainly due to dividends of approximately S$2.4 million paid during FY2024, repayment of lease obligations inclusive of lease interest of approximately S$11.6 million, and repayment of bank loans and finance lease during the financial year.

Commentary

The Group notes that inflationary pressures have remained persistent, particularly raw material and labour costs, and rental costs remain elevated. The current manpower shortage situation in the retail sector remains challenging while retail demand looks subdued in the near term.

The Group will continue with its current strategies to navigate this difficult period of sustained inflation. These strategies include efforts to reduce operating costs, improve gross margins and rationalise the Group’s operations to overcome manpower shortages, and to actively look for more non-retail revenue streams, including business-to-business sales. The Group continues to look for opportunities to increase the number of outlets at strategic locations such as high traffic transport hubs. The Group also constantly explores possibilities for synergistic business combinations, and to expand our logistics and manufacturing facilities.