Higher revenue, better margins push Cortina Holdings' Q1 net profit up by 77%

LUXURY watch retailer Cortina Holdings saw first-quarter earnings surging on higher turnover, improved sales margins and lower finance costs, according to unaudited results out on Friday.

Net profit was S$5.28 million for the three months to June 30, an increase of 77 per cent on the previous year, while revenue came in 12 per cent higher at S$104.5 million.

The turnover growth was partly offset by higher operating expenses - namely, higher staff costs as well as credit card commissions on the higher sales revenue, as well as a write-off of fixed assets from the renovation and closure of two stores in Singapore.

But finance costs dropped on lower average borrowings.

Sales margins rose to 24.5 per cent, up from 23.1 per cent in the year-ago period, Cortina noted in its financial statements.

Earnings per share stood at 3.2 Singapore cents, up from 1.8 Singapore cents the year before, while net asset value was 111.1 Singapore cents a share, against 107.7 Singapore cents as at March 31, 2018.

No dividend was declared, the same as in the year before.

"Market condition is expected to be positive for the rest of the financial year," Cortina said in its outlook statement.

"However, there will still be competition in the market that we operate in and the state of the global economy may have impact on the group if it deteriorate (sic).

"Barring unforeseen circumstances, the group expects to remain profitable."

Cortina last traded at S$1.05 on Aug 3.