Three major listed restaurant operators reported mixed first-quarter results, as companies faced changes in market trends.
Gourmet Master Co Ltd (美食達人), which owns cafe and bakery chain 85°C (85度C), posted a net income of NT$189.29 million (US$6.18 million) in the first three months of the year, up from NT$182.83 million a year earlier.
With earnings per share (EPS) of NT$1.34 last quarter, Gourmet was the only listed restaurant operator to see annual growth during the period, which the firm attributed to better cost control in China, after launching an online information platform in the fourth quarter last year.
INVENTORY CONTROL
“The system has helped the company control sales and inventory at each outlet [in China] more efficiently and immediately,” Gourmet Master said.
Revenue generated by the company’s China operations accounted for about 70 percent of its consolidated sales last quarter.
As for its Taiwan operations, Gourmet Master said it plans to accelerate the pace of its store renovations this year.
CIMB Securities Ltd said that the company’s “mini-remodeling” scheme requires less capital expenditure and a shorter renovation period, minimizing its impact on operations.
As a result, CIMB Securities forecast that Gourmet’s operating margin would continue recovering for the remaining quarters of the year, after rising to 6.6 percent in the first quarter.
HSBC Securities (Taiwan) Corp Ltd was not as positive, saying that the company’s “voluntary chain” (VC) business model, in which the company has less control, may be a new concern.
“Under VC models, VC owners cover all the high capital expenditure for store upgrades,” HSBC said last month.
Without headquarters’ support, VC owners may be reluctant to upgrade their stores, which conflicts with Gourmet Master’s long-term business goal of “rebranding” in Taiwan, the report said.
Meanwhile, both Tai Tong Food & Beverage Group (TTFB, 瓦城泰統集團) and Wowprime Corp (王品集團) saw a year-on-year decline in first-quarter net income.
FAST EXPANSION
TTFB, which operates five restaurant chains with 77 outlets in Taiwan and China at the end of March, saw net profit of NT$78.11 million, or EPS of NT$3.36, in the first quarter, down 5.11 percent from a year earlier, as the firm’s fast expansion raised operating costs and expenses, according to the company.
Wowprime’s net income plunged 46.58 percent year-on-year to NT$159.54 million last quarter, or NT$2.07 per share, because of the negative impact of higher fixed costs and lower sales because of the food safety scandals.
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