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Koufu posts 3.7% rise in Q4 net profit on higher sales

FOOD court operator Koufu lifted its fourth-quarter net profit by 3.7 per cent on higher sales, the group said on Tuesday.

Net profit for the three months ended Dec 31, 2018 stood at S$7.51 million, compared with a net profit of S$7.24 million posted the same period a year ago. 

The results translate to earnings per share of 1.35 Singapore cents, against earnings per share of 1.50 Singapore cents.

Revenue in the fourth quarter of 2018 was up 5.3 per cent from a year ago to S$57.05 million. 

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Revenue contribution from the outlet and mall management segment increased by S$3.3 million from a year ago to S$29.6 million, as contributed by three new food courts and one coffee shop opening in fiscal 2018 at Fusionopolis, Oasis Terrace, Sengkang General Hospital and Tampines T-Space. The increase was partially offset by the closure of three food courts at Star Vista, Marina Bay Link Mall, 1983 A Taste of Nanyang at Marina Bay Sands and 1 coffee shop at Blk 204 Choa Chu Kang Avenue 1, which are mostly unprofitable.

Revenue from the F&B retail business segment decreased by S$0.4 million from a year ago to S$27.4 million. This was mainly attributable to the closure of three quick-service restaurants at Harbourfront Centre, Changi Airport Terminal 2 and Fusionopolis, as well as the closure of 12 F&B stalls in fiscal 2018. The decrease was partially offset by revenue contribution from businesses such as the four new F&B stalls in the food courts and coffeeshop at Fusionopolis, Oasis Terrace, Sengkang General Hospital and Tampines T-Space, and several other F&B kiosks at locations such as Marina Bay Sands, SingPost Centre and United Square.

Other income also more than doubled from S$0.6 million in the year-ago period to S$1.4 million for the fourth quarter of 2018, mainly attributable to an increase in reimbursement of renovation fees charged to the stall operators arising from the renovation of existing and new food courts.

The board has proposed a final dividend of 1.2 Singapore cents per share. It did not declare a final dividend in the year-ago period. 

"The F&B industry continues to be highly competitive and challenging. Increasing rental costs and labour costs as a result of labour shortage are key challenges faced by the F&B industry," Koufu said in its regulatory filing.

It added that as part of its expansion plans, the group has secured five new food courts, one of which is in Macau, which are all targeted to open progressively in fiscal 2019.

Shares of Koufu closed unchanged on Tuesday at S$0.63.