Sheng Siong's Q1 FY22 net profit up 13.9% year on year

SUPERMARKET operator Sheng Siong : OV8 0% on Tuesday (Apr 26) posted a 13.9 per cent rise in net profit to S$35.1 million for its first quarter ended Mar 31, 2022, from S$30.8 million a year ago.

Revenue for the quarter rose 6 per cent to S$358 million, from S$337.5 million a year ago, according to the mainboard-listed group in a business update.

This was due to an increase in comparable same store sales by 4.7 per cent year-on-year in Singapore and 1 per cent year-on-year in China, it noted. It added that its new store in Singapore contributed 0.3 per cent increment to the total revenue increase. Sheng Siong has 64 stores in Singapore and 4 stores in China today.

Gross profit also grew 9.8 per cent year-on-year to S$102.7 million, with gross profit margins improving by 1 percentage point to 28.7 per cent in Q1 FY2022, which the group attributed to a change in sales mix.

Meanwhile, other income fell by S$0.7 million year-on-year to S$3.3 million for the quarter, due to a reduction in government grants received in line with Singapore’s economic recovery, the group said.

As inflationary pressures mount, Sheng Siong noted that consumers are “increasingly concerned with the higher cost of living and may choose to dine-in more at home,” which may continue to support sales at their supermarkets.

Moving forward, the group will “re-double” its efforts in sourcing for differentiated and reliable supplies, to ensure a stable supply of essential goods and to “bring value to its customers with competitive pricing and affordable products.”

Lim Hock Chee, Sheng Siong’s chief executive, also shared that the group secured the leases of 3 stores last year and is targeting to open 3 to 5 new stores per year for the next 3 to 5 years, with a focus on areas where it is not present in yet.

“For areas without the group’s physical presence, we are continuing to build on our e-commerce capabilities to be able to provide to all our customers the same convenience of our products,” he added.

Shares of Sheng Siong closed flat at S$1.53 before the results release.