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Jumbo Group Limited (Jumbo)

Source: Jumbo

Jumbo is a F&B group headquartered in Singapore and with 38 F&B outlets across 15 cities in Asia, including Singapore, Shanghai, Taipei, Bangkok, Seoul and Tokyo. The company has a portfolio of six restaurant brands and also provides catering services for customers in Singapore.

FY 2019 Financial Highlights:

Source: Jumbo FY 2019 Annual Report

· Jumbo’s revenue for the financial year ended 30 September 2019 (FY 2019) declined by 0.1% year-on-year to SGD 153.6 million.

· Nevertheless, gross profit improved by 1.4% from SGD 96.6 million in FY 2018 to SGD 97.9 million in FY 2019, as a result of lower cost of sales due to better cost control measures.

· Meanwhile, gross profit margin was also higher at 63.8% in FY 2019, as compared to 62.8% the previous year.

· Net profit increased by 5.9% year-on-year to SGD 11.7 million in FY 2019.

Performance Drivers:

Source: Jumbo FY 2019 Annual Report

Performance Drivers (Positive Factors)

• Singapore Operations

FY 2019 revenue from Jumbo’s Singapore operations increased by SGD 4.0 million year-on-year to SGD 126.4 million mainly due to the opening of two new Jumbo Seafood restaurants, a new Zui Yu Xuan Teochew Cuisine restaurant, as well as a new Chao Ting Teochew Pao Fan outlet. This increase was offset by an estimated SGD 1.2 million loss in revenue due to a four-week renovation of the Jumbo Seafood Gallery outlet.

• Global Expansion

During the financial year, Jumbo expanded its Jumbo Seafood restaurants’ overseas footprint to two new countries: Bangkok in Thailand, as well as Seoul and Ilsan in South Korea. The company also added another Jumbo Seafood restaurant in China, in the city of Fuzhou. Further, Jumbo opened three additional Ng Ah Sio Bak Kut Teh outlets in Taiwan.

In Singapore, the company opened a new Jumbo Seafood outlet at ION Orchard and another at Jewel Changi Airport. Jumbo also introduced two new dining concepts – Zui Yu Xuan Teochew Cuisine and Chao Ting Teochew Pao Fan, both located at Far East Square. Further, a second Tsui Wah “Cha Chaan Teng” (Hong Kong-styled restaurant) was added to Jumbo’s portfolio.

Performance Drivers (Negative Factors)

• China Operations

Jumbo’s China operations recorded a drop in revenue of SGD 4.1 million, from SGD 31.3 million in FY 2018 to SGD 27.2 million in FY 2019, due to lower sales from its restaurants there.

• Other Income

Jumbo experienced an 11.3% year-on-year drop in its Other Income, from SGD 2.7 million in FY 2018 to SGD 2.4 million in FY 2019. The drop was primarily due to lower payment from government credit schemes, the absence of a write back of impairment loss of associate recorded last year, as well as higher fair value loss in investments at fair value through profit or loss. Nevertheless, this drop was partially offset by higher interest income and government grants.

• Loss in the Share of Results of Associates

Jumbo’s share of loss from associates widened by SGD 0.7 million, from SGD 0.1 million in FY 2018 to SGD 0.8 million in FY 2019. The increase in losses was largely due to underperforming Jumbo Seafood restaurants in Taiwan, as well as a newly-launched restaurant in South Korea which has yet to make profits.

Source: Jumbo FY 2019 Annual Report

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