SINGAPORE (Nov 8): FJ Benjamin reported first quarter net loss after tax narrowed to $180,000 for 1Q19 from $942,000 for 1Q18.

Group pre-tax profit staged a turnaround of $77,000 compared to a loss of $764,000 in the previous corresponding period. The latest results included a foreign exchange loss of $92,000 against a gain of $820,000 in 1Q18.

Group turnover declined 23% to $31.7 million due mainly to an absence of $9.3 million from discontinued businesses and $1.3 million of foregone sales to the group’s Indonesian associate which started to purchase directly from its principals in April 2017 and a $0.8 million currency translation gain from the appreciation of the Malaysia ringgit against the Singapore dollar.

Sales in Singapore and Malaysia grew 6% or $1.7 million during the period under review with the fashion business up 12% while the timepiece business declined 30%.

Most of the group’s fashion brands registered comparable store growth while stores opened during 1Q18 contributed full three month sales to the latest results.

Gross profit margin improved five percentage points from 44% to 49% in 1Q19 due to better inventory management and the cessation of low-yielding labels.

Group operating expenses fell 21% to $15.6 million, helped by cost controls and the closure of non-performing stores and brands, which yielded total savings of $4.2 million.

As at 30 September 2018, inventory increased 1% to $31.8 million as the Group began to stock up for the coming peak seasons.

During the quarter under review, net borrowings totalled $14.2 million compared to $12.8 million as at June 30 with gearing at 27% compared to 24% previously.

Group CEO Nash Benjamin says: “We are heartened that our business performance has trended positively for the past seven quarters. This is the result of a combination of our restructuring efforts bearing fruits and better sales in our key markets. Management will be focused on growing our sales organically as well as accelerate our digital marketing activities. We plan to optimise growth and profitability of our popular brands as well as expand Casio’s distribution points-of-sales across Indonesia.”

Year to date, shares in FJ Benjamin are down 45% to 3.3 cents.