SINGAPORE (May 2): Food and beverage (F&B) group Envictus International saw its losses for the 2Q ended March 2018 widen 39.6% to RM4.8 million ($1.6 million) from 2Q17 loss of RM3.4 million due to higher operating expenses.
This brings the group’s loss for the half-year to RM9.4 million, nearly double than its 1H17 loss of RM4.9 million a year ago.
Revenue for 2Q18 grew 0.8% to RM101.1 million from RM100.3 million, primarily due to the strong performance of its food services division and additional contribution from its new dairies division, offset in part by lower contributions from its trading and frozen, food processing, and nutrition divisions.
Notably, Texas Chicken recorded 32.7% higher revenue of RM33.3 million over the latest quarter from RM25.1 million, buoyed by the additional opening of 12 new stores since 2Q17. Envictus also attributes the fried chicken chain’s better sales performance to higher brand awareness and the favourable market acceptance of its products.
San Francisco Coffee, too, registered 30.9% revenue growth to RM7.2 million from RM5.5 million previously after the addition of another eight stores.
Gross profit margin rose three percentage points to 37.4% due to the higher sales by the food services division, as well as the higher-margin contract packing for dairy & juice-based drinks business.
The group’s bottomline was however impacted by higher operating expenses, which rose 11.4% to RM41.7 million due to higher selling & marketing expenses as well as administrative expenses, which were largely to support the expansion of both Texas Chicken and San Francisco Coffee, as well as after the inclusion of the new dairies division’s operating costs.
Kamal Tan, group CEO of Envictus, says the group intends to capitalise on the Texas Chicken brand name and strong market position to improve site selections and rental terms by opening another two stores over the next two quarters.
On the San Francisco Coffee chain, he adds: “We plan to open another nine stores in the next two quarters of FY2018 as the coffee chain continues to make new strides with the successful completion of its rebranding exercise, refreshed menu and new concepts. We are optimistic that the new cafe concept with customised design theme for each individual store will enable the brand to expand its presence beyond office buildings and penetrate the malls as well as lifestyle markets.”
Shares in Envictus closed 1.45% higher at 35 cents on Wednesday.
