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Sakae in the red with S$5.8m loss for FY2015
FOOD and beverage (F&B) firm Sakae Holdings on Tuesday posted a net loss of S$5.8 million for its full year ended Dec 31, 2015. This was a reversal from a profit of S$2.1 million made a year ago.
The loss was due to reduced profit margins arising from foreign-exchange losses, rising operating costs and an increase in legal fees incurred over an ongoing legal case involving its associate companies Griffin Real Estate Investment and Gryphon Capital Management.
Revenue dipped 1.8 per cent to S$96 million as a result of weaker market sentiment and fierce competition in the F&B sector in Singapore.
The group's major operations in Malaysia were affected by a weakened ringgit and the GST (goods and service tax), as well as increasing political instability which lowered contribution from sales in the country.
The group extended in FY2015 its business to food trading to boost revenue and profit.
"Although cost of sales in food trading is much higher than retail sales, higher profit margins also were the case," it said.
Giving an update on its legal suits - in which various defendants have begun third-party actions against Sakae founder and chairman Douglas Foo - it said two suits concluded on Feb 26, 2016, and the High Court has fixed timelines for the parties to file their closing submissions and reply closing submissions in relation these two suits.
There are two other suits which the High Court has directed to be deferred for now.
The group has also applied for an injunction over the proceeds from the sale of Big Hotel, and expects the High Court to deliver its decision on the injunction application soon.