Gourmet Master Co (美食達人), which operates the popular 85°C (85度C) bakery-and-coffee chain in Taiwan, China, Australia and the US, reported NT$479.28 million (US$16.54 million) in earnings for the first half of the year, up 22.6 percent year-on-year on the back of fast expansion in China.
Revenue was NT$4.84 billion for the April-to-June quarter, a growth of 17.31 percent from NT$4.13 billion in the same period last year.
Operating margin increased 0.67 percentage points to 53.4 percent in the first half, according to the financial statement from Gourmet Master, which had 534 outlets worldwide as of June.
Gourmet Master opened 35 outlets in China during the first half of the year and expects to open 65 more to reach its goal of 100 stores by the end of the year.
It had operations in 25 Chinese cities as of June, up from 17 at the end of last year.
The outlets are mostly located in southern China, but Gourmet Master is evaluating expanding into the west and the north, vice president of finance Michelle Hsieh (謝明惠) told an investor conference organized by the Taiwan Stock Exchange.
“We are casting a very wide net in China and speeding up expansion ... It will be hard for our competitors to copy us,” she said.
The company aims to set up 85°C stores in most provinces, distancing itself from rivals that could only focus on certain provinces because of the difficulty in standardizing production.
For instance, the dough used in the stores’ bakery is hard to standardize as its taste changes depending on a region’s temperature and humidity, she said.
Gourmet Master has “central kitchens,” where production is standardized. The kitchens supply ingredients to outlets within a certain geographic proximity.
In addition to the multi-city expansion, Gourmet Master said it was planning to sell more moon cake products in China, a lucrative market estimated to be worth 20 billion yuan (US$3.12 billion) a year.
Its first outlet in Hong Kong is expected to open by December.
Last month, Gourmet Master and its Hong Kong partner, Cafe de Coral Holdings Ltd (大家樂集團), set up a HK$30 million (US$3.85 billion) venture to operate the 85°C brand in the territory.
Cafe de Coral is the largest Chinese restaurant-chain operator and Gourmet Master has benefited from its know-how in the domestic market, Hsieh said.
Gourmet Master, which opened its second outlet in California last week, is exploring more market expansion and plans to replicate the Hong Kong venture model elsewhere, she added.