Kimly H1 profit falls 14.7% to S$18.5m, 0.56-cent interim dividend declared

COFFEE shop operator Kimly : 1D0 0% on Wednesday (May 11) posted a net profit of S$18.5 million for the first six months of the year ended March, declining 14.7 per cent from S$20.7 million net profit previously recorded in H1 FY2021.

The decline comes despite its revenue increasing by 27.9 per cent to S$156.9 million from S$122.6 million previously, as revenue contributions in some segments fell and cost of sales increased in H1 2022.

Nevertheless, the group declared an unchanged interim dividend amount of 0.56 Singapore cent, which will be paid on or around Jul 15, 2022. 

The bulk of group revenue growth for H1 2022 came mainly from the food retail division, which increased to S$96.7 million from S$59.9 million previously, owing to revenue contributions from the newly acquired Tenderfresh Business in October 2021.

However, there were lower revenue contributions following the closure of 12 underperforming food stalls, mainly on the back of a manpower shortage. The outlet management division and outlet investment business division also recorded falls in revenue contribution attributable to the decrease in sale of beverages and tobacco products, arising from lower footfall at most of the group’s coffeeshops due to Covid-19 restrictions.

Cost of sales notably increased to S$109.1 million from S$82.4 million previously, driven by lower government grants, higher utilities charges (in line with the rise in electricity tariffs), higher employee benefits by Klovex in providing cleaning services, and an increase in the depreciation of right-of-use assets.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

The group’s gross profit increased to S$47.8 million from S$40.3 million, and gross profit margin fell to 30.4 per cent from 32.9 per cent.

Earnings per share was 1.49 Singapore cents, down from 1.83 cent a year ago.

“We believe that the corporate developments in FY2021 have laid a strong foundation for the group to grow, as well as equip the group with more capabilities to better serve our customers,” the directors of Kimly said.

The group said it will focus on carrying out its 4-pronged growth strategy:

• Driving growth, which includes expanding its footprint;
• Diversifying its product offerings and revenue channels;
• Expanding its food retail division; and
• Strengthening its operation capabilities to improve efficiency and productivity.

Shares of Kimly closed flat at S$0.39 on Wednesday before the announcement.