Japan Foods Holding has reported a net loss after income tax of $2.9 million for its 3QFY2025 ended December 2024 in its business update. This is in comparison to a net profit after income tax of $0.67 million in the same period a year ago.
Despite a higher number of operating outlets, the group’s revenue decreased 0.6%, from $65.3 million in 3QFY2024 to $64.9 million in 3QFY2025 mainly due to weak sales in November and December 2024. In line with the lower revenue, gross profit was 0.7% lower y-o-y at $54.9 million.
Other income increased by 89.9% y-o-y to $2.0 million, mainly attributable to royalty income, government grants under the Progressive Wage Credit Scheme and the Job Growth Incentive Scheme, interest income, insurance claims and compensation for relocation of a restaurant within VivoCity.
Overall cost and expenses increased, with selling and distribution expenses, operating expenses, lease interest expenses and impairment losses increasing during the period.
On the outlook, the group is in the view that the F&B industry in Singapore has been affected by the strong Singapore dollar, which has encouraged more Singaporeans to travel and spend overseas (in particular, Japan). The group expects its business environment to remain tough, with conditions further compounded by ongoing industry challenges including manpower shortages, rising costs of operations due to inflation and changing consumer preferences.
To overcome these challenges, the group plans to rationalise its brand portfolio by focusing on its more established and proven brands. In line with this turnaround strategy, the group has decreased the number of operating outlets from 84 as at Sept 30, 2024 to 82 as at Dec 31, 2024. The group will continue to streamline its operations, manage costs and improve outlet performance by stepping up on marketing and promotional efforts.
See also: LHN Group adds 45 new keys and 29 new facilities management contracts in 1QFY2025 business update
Shares in Japan Foods Holding closed at 34 cents on Feb 6.
