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Sakae swings into the red with Q2 loss
SAKAE Holdings has reported a net loss of S$545,000 for the second quarter of fiscal 2019, from a net profit of S$99,000 the year before. This was attributed to a streamlining of operations, which resulted in a fall in revenue, while cost of sales and labour costs dropped accordingly, the company said in a Singapore Exchange filing.
Loss per share (LPS) for the quarter ending Dec 31, 2018 stood at at 0.39 Singapore cent compared to earnings per share (EPS) of 0.07 Singapore cent the year ago. No dividend has been declared for the quarter.
Revenue for Q2 stood at S$11.2 million, decreasing 39.6 per cent to S$18.6 million the year before.
The streamlining of group operations also resulted in reductions in administrative expenses by 22.4 per cent to S$5.4 million for Q2 from S$6.9 million the year before. Labour costs also decreased by 14 per cent to S$4.3 million for the period from S$5 million the year before. Other administrative expenses including depreciation charges and other expenses also fell.
Other operating expenses were at S$2.7 million, a 3.2 per cent decrease from S$2.8 million the year before, resulting in improved margins.
The group's Q2 gross profit was S$7 million, down from S$9.5 million the year before. Gross profit margin, meanwhile, increased by 11.4 per cent to 62.5 per cent from 51.1 per cent due to effective management of operations, said Sakae.
For first-half 2019, the group posted a net loss of S$469,000, compared to S$305,000 in net profit the year before. LPS per share was 0.33 Singapore cent, compared to EPS of 0.22 Singapore cent the year before. Meanwhile, revenue for H1 2019 fell 38.2 per cent to S$21.6 million, compared to S$35 million the year before.
The company disclosed that it had earlier provided an update to the outcome of legal proceedings and that the liquidation of Griffin Real Estate Investment Holdings (GREIH) was ongoing. Defendant TYN Investment f ka ERC International (TYNI) have joined Sakae chairman Douglas Foo, in his personal capacity as a third party, to claim contribution or indemnity from Mr Foo, in the event that TYNI is held liable to the liquidators of GREIH. Sakae disclosed that the third party joinder of Mr Foo does not materially affect the company’s business operations.
With regard to its sugar trade business, the company reiterated that investigations are still ongoing and will provide further updates where appropriate. The company had filed a police report in September 2018 after its auditors questioned the validity of certain commodity trade transactions.
The counter was last traded on Feb 8 at 14.5 Singapore cents.