Sheng Siong Q1 net profit up 12.6% on stronger sales

[SINGAPORE] Supermarket operator Sheng Siong recorded a 12.6 per cent increase in net profit to S$43.4 million for the first quarter ended Mar 31, from S$38.5 million the year before.

Revenue grew 12.4 per cent to S$452.8 million, from S$403 million in the corresponding period last year.

This was attributed to the 12 new stores that opened in FY2025, as well as higher festive sales in the Chinese New Year and Hari Raya periods, said the company in a business update on Wednesday (Apr 29).

Gross profit rose 15 per cent to S$140.3 million in Q1, from S$122 million in the year prior.

Earnings per share stood at S$0.0287, up 11.7 per cent from S$0.0257 in the year-ago period. 

The improved performance came despite higher operating costs driven by a 12.8 per cent year-on-year increase in administrative expenses to S$17.8 million, and a 15.6 per cent rise in selling and distribution expenses to S$76.1 million.

Sheng Siong attributed the increase to higher staff costs to support more stores and higher variable bonuses after an improved financial performance.

It also experienced higher depreciation arising from the additional leases of supermarket stores and land lease for the group’s new distribution centre at Sungei Kadut.

Cash flow from operating activities in Q1 went up by S$11.6 million year on year from higher profit and more non-cash payments received during the period.

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Amid geopolitical uncertainty and rising operating costs, the company noted that it is “actively refining its sales mix” and will continue to “diversify (its) supplier base to enhance supply chain resilience, while investing in automation to improve operational efficiency and mitigate rising labour costs”.

Sheng Siong chief executive officer Lim Hock Chee noted that the group is expected to open two new stores in the second quarter, and another in the third quarter this year. The company is also awaiting five tender results to be released by the Housing & Development Board, noted Lim.

“Through our prudent cost management and ongoing efforts to optimise our sales mix, we remain dedicated to combating rising business costs,” he said.

The counter closed at S$2.99 on Wednesday, down 0.7 per cent or S$0.02, before the results.