Old Chang Kee to explore e-commerce, undertakes catering to boost revenue

FOOD and beverage operator Old Chang Kee said on Monday that it is expecting a decline in the sales and operating profits of the group's retail outlets in the near term. 

In an update on the impact of Covid-19 impact on its business, the group said that at this stage, it is still determining the extent of the financial impact on the group's earnings per share and net asset value per share for the financial year ended March 31, 2020.

In Singapore, Old Chang Kee has streamlined its operating stores since the start of the "circuit breaker" period early this month. Out of a total of 89 operating stores in Singapore, 22 have been temporarily closed; these outlets are those located mainly in the central or tourist belts or in parks. Its remaining 67 stores, including sub-brands such as Curry Times, are still open for takeaway and delivery. The group has also adjusted the operating hours for outlets that remain open, following a review of traffic flow.

To protect its vulnerable senior workers and to minimise the risk of exposure to Covid-19 for both staff and customers, the group has reduced its operating frontline staff strength by approximately 20 per cent. Vulnerable senior frontline workers have either been encouraged to clear their annual leave or been redeployed to non-customer facing roles, said the group.

As a halal caterer with the necessary certifications, the group has been receiving corporate catering orders, including dormitory orders, for bento meals.

"The meal orders for dormitories will fluctuate, depending on the Covid-19 situation and the movements of the quarantined workers residing in dormitories, but these non-retail revenue should help to partially offset the drop in retail sales," said Old Chang Kee in a statement.

To reduce its customers' needs for frequent grocery trips, the group is also exploring with e-commerce partners on methods to expand the commercial sale of its food items. To date, the group said that its supply chain, including its network of key suppliers, remains resilient.

For overseas markets, the group's central kitchen in Iskandar Malaysia and Perth outlet remain open. It has temporarily closed four outlets in Kuala Lumpur and London. Its master franchisee in Indonesia have also temporarily closed all its outlets in Jakarta.

The situation in the overseas markets remains grave, especially in London, said the statement.

The group is currently in the early stages of assessing the impact of potential impairment to its assets in the overseas markets.