SINGAPORE (May 28): Tung Lok Restaurants (2000) reported a loss of $1.4 million in FY18 compared to earnings of $0.42 million in FY17 due to a combination of higher expenses and lower other operating income.
For the 2H ended March, the group reported earnings of $0.8 million compared to $1.4 million in 2H17.
Revenue for the full year under review grew 0.8% to $85.7 million from $85.1 million a year ago due to higher catering sales and the stronger performance of existing outlets.
These factors were however offset in part by a cancelled contract, lower mooncake sakes as well as loss of revenue from closed outlets over FY18.
Administrative expenses grew 4% to $31.5 million from $30.3 million a year ago due to salary adjustments and staff incentives.
Meanwhile, other operating expenses grew 2.7% to $34.5 million compared to $33.6 million in FY17, which was a result of a business and operation review exercise which Tung Lok conducted over FY18 in an effort to rationalise and streamline the group’s non-performing outlets.
Higher rental and utility expenses, too, contributed to the increase in other operating expenses.
On the other hand, other operating income fell 28.9% to $1.8 million from $2.6 million in FY17, with the group having received lower government grants and credits, as well as lower marketing and promotional funds compared to that of a year ago.
Cash and cash equivalents grew to $15.4 million from $15 million, mainly attributable to positive cash generated from operating activities of the group.
Despite the net loss in FY18, Tung Lok says it has worked hard to improve cash flows from its operations, which has enabled it to further strengthen its balance sheet with bolstered cash & bank balances as well as improved net working capital position.
The group intends to continue to adopt a prudent stance when expanding its brands locally and overseas.
Shares in Tung Lok closed flat at 21 cents on Monday.
