Public subsidy cushions Cafe de Coral income of HK$162m

Business | 26 Nov 2020 1:19 pm

Cafe de Coral (0341), Chinese fast-food restaurant chain, said net profit increased by 8.4 percent to HK$162.3 million for the half year ended September, thanks to government relief of HK$338.9 million.

An interim dividend of 10 HK cents was declared. The basic earnings per share were 28 cents.

Cafe de Coral said revenue fell by 24.3 percent to HK$3.23 billion. Revenue in Hong Kong slumped 26.9 percent to HK$2.67 billion, while the mainland market saw a 9.1 percent drop to HK$555.9 million.

Gross profit margin plunged by 7.3 percentage points to 4.3 percent.

The company said it received subsidies of HK$322.5 million under the government's Employment Support Scheme. The subsidies, which were used for paying salaries and wages, accounted for about 31.6 percent of staff cost in the local market.

As of September 30, total headcount increased by 956 to 19,788 from end-March, as it is aiming to build and equip the team for the “new normal” during and after the pandemic.

It was operating 285 outlets in Hong Kong as of end September, down by 9 from March. Outlets in mainland China increased by one to 115.

Cafe de Coral said its business and operations in mainland China had begun to recover to pre-pandemic levels. It is planning to expand the store network in the Greater Bay Area during the latter half of the financial year.

The company plans to open 10 new outlets by year end.

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