Cafe de Coral to open new outlets

Business | Dominique Nguy 29 Nov 2016

Cafe de Coral (0341) chief executive Peter Lo Tak-shing said yesterday that the fast food chain plans to open 11 new outlets in the next few months and hire an additional 800 to 1,000 staff.

He said the company has been hiring more people over the past 12 months even as it provides its staff with competitive wages.

Growth in the wages and salaries of frontline technical staff has gone up by double digits over the past year as it experienced growing difficulties in hiring additional staff, he said.

He stressed that the company will exert more efforts to control other operating costs to try and offset the rising costs of wages and salaries.

Cafe de Coral's net profit in the first half rose 11.8 percent to HK$232 million from a year earlier, while revenue was 4.3 percent higher at HK$3.89 billion.

Lo attributed the rise in revenue mainly to the overall improvement in Hong Kong's food and beverage business environment.

The average price per meal at Cafe de Coral outlets has gone up by about HK$1 to HK$2 to HK$35 from the same period last year, he said.

Lo said the company takes a positive view on the prospects for Hong Kong's food sector and it is on this basis that it is mapping out plans to open more branches.

He said that while rents have not dropped significantly, current levels are still affordable to the company.

The board has recommended an interim dividend of 18 HK cents per share.

In China, sales of Cafe de Coral's restaurants grew 1.2 percent from a year earlier.

But overall revenue dropped 16.3 percent due to the adverse impact of the new value-added tax rule and the closure of non-performing stores.

The fast food chain said in its interim report that it has closed down various non-performing outlets in eastern and southern China. It has also strengthened operational efficiencies in its profitable outlets.

Lo said he remains cautiously optimistic on prospects in the future of the company's business in the mainland.

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