Electronics retailer Tsann Kuen Enterprise Co (燦坤實業) will close its six unprofitable restaurant brands to focus on its core business, the company said in a statement on Saturday.
However, the company will continue to operate its coffee chain, it said.
“The closure of the [restaurant] brands aims at focusing on our core business and ending losses,” said Star Travel Corp (燦星旅遊) chairman Ray Yang (楊文芳), who is responsible for operating the group’s food businesses.
Tsann Kuen entered the food and beverage industry in 2013, with a goal of developing 20 brands in 10 years.
By last year, Tsann Kuen had launched high-end Japanese patisserie La Bonbonniere Cafe (日法坊); pork chop restaurant Fujimaru (富士印); 55 Udon (五食五心); Love, Italy (樂義); a hot pot restaurant; and Sous-Vide Steak and Charcoal (純焠餐飲).
The six brands, operated by Tsann Kuen’s subsidiary, Star Food and Beverage Capital Co (燦星文創), incurred a total loss of NT$85.84 million (US$2.65 million) in the first half of last year. Tsann Kuen reported that its earnings per share in the first half of last year decreased 47.06 percent to NT$0.72 from NT$1.36 a year earlier, a filing with the Taiwan Stock Exchange showed.
Tsann Kuen decided to terminate its first restaurant chain in the third quarter last year, closing three hot-pot outlets.
However, the company did not exit the restaurant industry at the time and increased its holdings in Crown and Fancy Coffee House (金?咖啡), which started out as a street shop in Kaohsiung in 2000, to 80 percent and obtained its operating rights in January.
The nation’s largest home appliance and consumer electronics chain’s agreement with the coffee chain aims at something different from others, the company said.
It is expected to follow the business model of Tchibo, a German retailer and cafe chain, by offering cafe services as well as commercial coffee machines and consumer items such as CDs and smartphones.
“The business model could increase the consumer visit rate in general,” the company said.
Tsann Kuen established a 13,223m2 research and development center, called MagicLab, in Tainan last year, in a bid to develop coffee machines and coffee-themed merchandise.
“We plan to create Taiwan’s native culture in coffee,” the company said in the statement, adding that Crown and Fancy would now have the group’s full attention.
Yang on Sunday said that Crown and Fancy operates 30 outlets in the nation and hopes to expand each month to become the No.1 coffee chain in the local market.
Tsann Kuen’s shares yesterday increased 1.78 percent to close at NT$22.9 in Taipei Trading, outperforming TAIEX’s 0.4 percent decline.
The company is to pass last year’s financial report and a cash dividend of NT$1.2 per share in a shareholders’ meeting on Friday.
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