In 2023, Goodwill diversified into new ventures like FATE by HaveFun, a dance club concept at Cineleisure Orchard; and HaveFun Live Show, a daily concert-style venue at Bugis+ mall.
The group also entered the F&B space with the launch of Yakitori One and a central kitchen under subsidiary Cookease, serving both its own outlets and third-party clients.
“These initiatives reflect Goodwill’s strategy to build a vertically integrated platform spanning entertainment and dining,” says Ng.
Ng also believes Goodwill “consistently” delivers “strong” gross profit margins of over 80% and “healthy” operating cash flows, generating $20.5 million in operating cash in FY2024 ended Dec 31, 2024 “despite ongoing expansion efforts”.
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According to Ng, Goodwill’s “capital-efficient model” and net cash position of $9.9 million provide a strong foundation for funding growth internally, minimising reliance on external funding.
Since 2021, revenue has grown over 50 times, notes Ng, driven by outlet expansion and the launch of new concepts.
Financial highlights
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In FY2024, Goodwill’s revenue grew 121.4% y-o-y to $53.0 million, driven primarily by contributions from new business segments. HaveFun Live show, alongside its F&B and manufacturing segment, contributed a combined $24.7 million.
The newly opened outlets and flagship Bugis+ live show venue were key top-line growth drivers, notes Ng.
During the year, Goodwill’s gross profit grew 112.9% y-o-y to $42.9 million, though gross margin declined slightly from 84.3% in FY2023 to 81.0% in FY2024.
Net profit rose 71.6% y-o-y to $5.6 million, with net profit margin declining from 13.5% in FY2023 to 10.5% in FY2024 due to higher staff costs, lease expenses and depreciation related to newly leased venues.
Excluding one-off IPO expenses, net profit would have increased 87.1% y-o-y to $6.7 million.
Goodwill’s operating cash flow was strong at $20.5 million, allowing the company to fund $6.7 million in capex and still end the year net cash positive, notes Ng.
As of end-2024, Goodwill is currently in a net cash position of $9.9 million, representing 16.5% of its market capitalisation.
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Industry risks
Goodwill announced in February its expansion into Malaysia through a joint venture. Ng believes this “opens doors to a significantly larger market”. “Goodwill is well-positioned to tap into Southeast Asia’s growing demand for experience-driven entertainment.”
Still, the pandemic has reshaped Singapore’s entertainment scene, says Ng, with several operators scaling back operations.
For example, Party World KTV closed multiple outlets post-pandemic. “This presents consolidation opportunities for stronger players like Goodwill, which could potentially acquire assets, take over vacated leases or enter strategic partnerships, such as its joint venture with Hezhong at Bugis+ for the HaveFun Live Show concept,” writes Ng.
Risks to Goodwill include the “highly regulated” entertainment space, where issues like noise complaints and hygiene lapses may lead to fines or licence suspensions.
The entertainment and F&B industry is also very competitive, with rivals like Teo Heng and Cash Studio in Singapore and Red Box and Loud Speaker in Malaysia potentially eroding market share through pricing or promotions, adds Ng.
Additionally, rising operating costs driven by higher rents, labor shortages, and inflation pose a margin risk. In FY2024, Goodwill’s staff and lease expenses more than doubled, and continued cost pressures may further squeeze profitability if pricing power is limited.
As at 10.10am, shares of the thinly traded Goodwill are trading flat at 15 cents. Its shares have lost a quarter of their value since IPO in November 2024.
