Challenger H1 net profit halves to S$4.8m

CHALLENGER Technologies reported a 48 per cent decline in net profit for the first half ended June 2022, largely due to a fair value loss and reduced Covid-19 related government support.

Net profit for the 6 month period fell to S$4.8 million from S$9.3 million a year earlier, even as revenue remained relatively stable, the IT products retailer said in a bourse filing on Thursday (Aug 4).

On a per share basis, earnings fell to S$0.012 in H1 2022 from S$0.0271 in the prior year period. No dividend was declared, unchanged from a year earlier.

Challenger noted that the weaker profit was largely due to a fair value loss on investment of S$2.4 million compared with a fair value gain of S$0.3 million last year. Operating expenses during the first half also rose S$0.6 million year on year.

 Excluding the impact from fair value loss on investment and government wage support,  Challenger said net profit would have been 4 per cent lower than the same period last year.

Revenue for H1 2022 fell 3 per cent on year to S$131 million, mainly due to lower retail and online sales.

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“The retail sector continues to remain challenging amid the constantly evolving and uncertain Covid-19 situation, and with supply chain disruptions remain an issue for some brands of product,” Challenger said. 

The group said it will continue to focus on its core retail business, while ramping up e-commerce engagement by collaborating with e-commerce platforms, and enhancing the overall product range.

Challenger shares fell 1.8 per cent to close at S$0.56 on Thursday, before the results.