RESTAURANT operator Japan Foods : 5OI 0% on Thursday (Jul 21) reported net profit of S$1.4 million for the first quarter ended Jun 30, reversing from its previous year’s loss of S$1.2 million on a surge in revenue.

Revenue for the quarter grew 91.8 per cent to S$18.8 million from S$9.8 million the year before. This was attributed to the positive response to the group’s expanded halal segment, which was further boosted by the recent lifting of Covid-19 measures including capacity limits and restrictions on dining in.

Gross profit rose 93.6 per cent to S$15.9 million in the latest quarter from S$8.2 million, while gross profit margin grew 0.8 percentage point to 84.8 per cent.

An S$84,000 share of loss of associated companies was recorded in the latest quarter compared to a S$125,000 share of profit the previous year, mainly due to losses by Japan Foods’ associated companies in China as a result of the country’s “strict zero-Covid-19 stance” during the period.

In its business update, Japan Foods said it is expecting the next 12 months to remain challenging as Singapore’s food and beverage (F&B) industry continues to face a manpower crunch.

Based on the group’s observations, this has led to high demand and competition for service staff that has intensified since the lifting of Covid-19 related restrictions. It is also anticipating higher cost of operations due to inflationary pressures and an uncertain economic outlook.

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The group nonetheless expects continued growth in its halal segment, and said it is working towards opening its first Thai concept restaurant in Tokyo in August this year.

Shares of the Catalist-listed counter ended Thursday flat at S$0.42