Sheng Siong's profits soared 98% to $54.41m in H1

The company saw elevated consumer demand in Q2.

Singapore-based Sheng Siong Group's profit attributable to its owners surged 98% YoY to $54.41m (S$74.82m) in H1, from $27.47m (S$37.78m) in H1 2019, the company announced. Revenue rose 52.7% to $543.49m (S$747.4m) over the same period.

In Q2, profit soared 150.4% YoY to $33.54m (S$46.12m), whilst revenue expanded 75.8% to $304.45m (S$418.67m). This was mainly driven by elevated demand as consumers stocked up to hedge against the risks of the supply chain disruption and the Circuit Breaker measures.

The company declared an interim cash dividend of $0.025 (S$0.035) cent per share.

Gross margin improved from 27.4% in 2Q2019 to 28.1% in Q2, largely due to selling prices being underpinned by strong demand, improvement in sales mix arising from diversification in sourcing and increase in the volume of house-brands in Q1.

Meanwhile, administrative expenses grew $16.87m (S$23.2m) during the quarter, in part no thanks to higher staff costs as additional headcount was required to cope with the higher volumes, implement the safe distancing and tracing measures, and operate new stores.

Capex amounted to $7.13m (S$9.8m) in Q2, consisting mainly of fitting out new stores and IT equipment for supermarkets totalling $3.35m (S$4.6m), equipping new warehouse extension and maintenance for the distribution centre for $3.71m ($5.1m) and $72,720 (S$100,000) incurred by the supermarkets in China.