Restaurant chain operator Wowprime Corp (王品集團) yesterday posted a 0.45 percent annual decline in net profit for last year, due to higher operating expenses from its rapid expansion in China.
Net profit fell to NT$1.02 billion (US$33.56 million), or earnings per share of NT$13.64, last year, slightly lower than net income of NT$1.024 billion, or NT$13.92 a share, in 2012, the company said in a statement yesterday.
During the October-to-December period last year, net income contracted 45 percent to NT$147.53 million, from NT$269.05 million a quarter earlier.
That represented a 33.74 percent decline, compared with NT$222.59 million in the same period of 2012, a company filing to the Taiwan Stock Exchange said.
“The group unveiled two new brands and 28 new outlets in China last year, which led to higher operating expenditure,” the statement said.
Wowprime also saw its Chinese joint venture with Jollibee Foods Corp of the Philippines, which operates the hotpot restaurant chain 12 Sabu (石二鍋), post a loss last year in the preliminary stage of its development, limiting the restaurant operator’s gains from its overseas investments.
Operating income in China fell 8.9 percent to NT$319 million last year from the previous year, while the restaurant chain’s overall operating income grew 1.05 percent year-on-year to NT$1.42 billion, the statement showed.
Because of weak profitability, Wowprime’s board of directors decided to reduce this year’s cash dividends compared with last year.
The company is set to pay a cash dividend of NT$11 and stock dividend of NT$0.3 in shares this year, compared with a cash dividend of NT$13.67 and stock dividend of NT$1 in shares last year.
In November last year, the firm inked an agreement with Singapore’s Pu Tien Holdings Pte Ltd (莆田控股) to launch Sufood (舒果), Wowprime’s vegetarian restaurant brand, in the city-state, with the aim of opening eight outlets within five years. It is the third Wowprime brand to be licensed overseas, following 12 Sabu and Tokiya (陶板屋).
As at the end of last month, Wowprime operated 14 restaurant chains with 364 outlets.