SINGAPORE (Aug 30): Kitchen Culture, the distributor of high-end kitchen systems, announced a loss of $6.4 million for the full 18 months ended June compared to a loss of $5.3 million in FY15 ended Dec.
The company last year announced a change of financial year end from Dec 31 to June 30.
As such, its latest results announcement covers the 18 months from Jan 1 2016 to June 30 2017 (FP17), where the lower bottomline resulted mainly from lower gross profit margin and a rise in expenses.
Revenue for FP17 nearly doubled to $49.6 million from $26.6 million in FY15 due to higher revenue contributions from the group’s residential projects as well as distribution and retail segment.
This was further boosted by higher revenue from Kitchen Culture’s businesses in Hong Kong and China, which was offset in part by a drop in revenue from Malaysia.
Over FP17, residential projects accounted for 66% of total revenue, with the bulk of contributions due to the company taking on a large scale project over FP17 as compared to FY15.
The remaining 34% of revenue is attributable to the distribution and retail segment, which also grew in contributions compared to the previous financial year as a result of accounting for a longer 18-month period in FP17 compared to just 12 months for FY15.
In spite of the higher gross profit recorded in line with the higher revenue, the group registered lower gross profit margin at 30.6% compared to 47.6% in FY15 as the company had taken on a number of large-scale projects which had comparatively smaller margins.
Over FY15, the group also realised an exchange gain and remeasurement gain which was absent over FP17, causing other income to fall by $1 million to just $0.1 million.
Selling and distribution expenses rose 18.8% to $10.8 million from $9.1 million in FY15, while general and administrative expenses, too, grew 76% to $9 million from $5.2 million a year ago due to the longer 18-month period.
Kitchen Culture says it will continue to capitalise on its core competencies over the next 12 months, where it will focus on the sale of its imported products for residential projects as well as for distribution and retail in both local and regional markets.
Looking ahead, the group intends to continue exploring opportunities to streamline its operational costs, although it expects the business conditions in Singapore and the region to remain challenging and competitive over the next year.
Shares in Kitchen Culture last traded at 19 cents on June 16.
