Sheng Siong made S$29 million in profit over the past three months and they are most likely going to make some more.
New Sheng Siong branches opening
In its latest financial report announcing the supermarket operator's solid performance, CEO Lim Hock Chee revealed that Sheng Siong will open three more branches in the heartlands.
The two new HDB stores will be located at Tampines Street 86 and Sengkang West Avenue, and a new outlet will also open at Potong Pasir Community Club.
The CEO note said Sheng Siong will continue to look for retail space in areas where potential customers reside but where they do not yet have a presence.
However, the opening dates are not confirmed due to the circuit breaker measures imposed during this Covid-19 pandemic, as fitting out works cannot be carried out at the moment.
You can read the CEO note from the first business quarter in full here:
LOOKING FORWARD
Subsequent to 1Q2020, we have secured two new HDB stores which were tendered in January 2020. These are at Block 872C Tampines Street 86 (8,490 square feet) and Block 455 Sengkang West Avenue (9,040 square feet). As of now, HDB cannot fix a date for the execution of the lease agreements because of the “Circuit Breaker”. In addition, we have also won a tender for a 4,610 square feet shop in the Potong Pasir Community Club, 6 Potong Pasir Ave 2. We will commence fitting out works the moment the premises is handed to us after the “Circuit Breaker” is lifted. To summarize, to-date, we would have opened a total of 5 shops in 2020 bringing our total store count to 64 and retail area to approximately 575,160 square feet. We will continue to look for retail space in areas where our potential customers reside but we do not have a presence, nurture the growth of
our new stores and build on the momentum of improving comparable same store sales.
Competition is likely to remain keen among the brick and mortar and online players. Some international food companies are warning of future disruptions to the supply chain and increase in prices because of lock-down in many countries as a result of COVID-19.
I do not know when COVID-19 will be over or when the economic situation in Singapore or worldwide would normalize. When that happens, I expect our revenue to taper off from the current elevated levels as buffer stocks kept by households are consumed. In the meanwhile, we will continue to hold a higher than normal level of inventory to hedge against potential disruption to the supply chain.
I am grateful to all our staff and suppliers who have worked very hard during these periods of elevated demand. The staff have gone beyond their call of duty and I wish to reward them (excluding directors) with an additional month of salary. I would like to close off by reiterating that your safety, our customers’ and other stakeholders’ safety are of paramount importance to us. We will continue to maintain a high standard of hygiene and comply with the directives given by the Ministry of Health.
Lim Hock Chee
CEO
28 April 2020
Top photo via Zheng Zhangxin