Sakae's revenue plunges amid streamlining of operations

In a filing on Singapore Exchange, Sakae Holdings reported a 39.6% drop in group revenue for the second quarter of fiscal 2019 (Q2FY2019) ending 31 December 2018. The company's revenue totalled $11.2 million, despite achieving $18.6 million in the same period in the previous year.Its profits also took a hit, from $99,000 in earnings last year to a net loss of $545,000.Sakae attributed this to streamlining of operations that resulted in a fall in revenue. However, reductions in operating expenses have resulted in improved gross profit margins from 51.1% in Q2FY2018 to 62.5% inQ2FY2019. Administrative expenses and labour costs decreased by 22.4% and 14% respectively.In a commentary, the company said, "Due to intense competition within the food and beverage industry, in addition to acute labour shortages, the Group expects operating conditions to be challenging as food, labour, rental and utilities costs continue to rise in the foreseeable next 12 months. The Group continues to work hard to manage the challenging operating conditions in the food and beverage industry."Marketing has reached out to Sakae for further comments.In 2017, Sakae had shut down more than 10 of its 46 outlets in the first half of the year due to rising business costs. However, the company had remained optimistic, with its founder Douglas Foo citing expansion plans and better operational conditions in other markets.