Two newly opened outlets and a recently established central kitchen have underperformed
SOUP Holdings expects to report a loss for the financial year ending Dec 31, 2024, it said in a bourse filing on Saturday (Dec 21).
The expected loss – compared to a profit recorded in the previous financial year – is likely a result of outlet closures, initial losses from new operations, and rising operating costs, said the company, which runs the Chinese restaurant chain Soup Restaurant.
Two outlets were closed for renovations, and another three outlets were closed due to redevelopment works by their landlord in the first quarter of FY2024.
Two newly opened outlets and a recently established central kitchen also underperformed – incurring losses during their first year of operations.
Meanwhile, the company noted a faster increase in operating costs compared to the growth in revenue, driven by broader macroeconomic conditions, a manpower shortage and rising rental costs.
It incurred impairment losses of plant and equipment and right-of-use assets from its underperforming restaurant outlets.
It also had a decline in revenue from its food processing, distribution and procurement services segment, as contracts expired for the supply of ready meals through the central kitchen.
For the half year ended Jun 30, 2024, Soup Holdings posted a revenue of S$20.7 million, down 0.6 per cent on year, while net profit fell 87.9 per cent to S$167,000.
Shares of Soup Holdings closed 3.1 per cent or S$0.002 lower at S$0.063 on Friday, before the announcement.
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