Sakae Holdings to close 6 more restaurants
Rising business costs have taken their toll on Sakae Holdings, operator of the Sakae Sushi chain, which has shuttered 10 of its 46 restaurants in the past few months.
The firm also has plans to cut six more by the first half of the year.
The listed company has been in loss-making mode over the last two years due to a sluggish economy and fierce competition in the food-and-beverage sector.
Its fourth-quarter net loss widened to $5.2 million from $4.7 million, while revenue fell 4.2 per cent.
The firm on Thursday said it made a provision of $3.4 million in its fourth-quarter results for the early termination of leases as it closes its non-performing restaurants.
But its founder, Mr Douglas Foo, remains "confidently optimistic" as the company is focused on growing the Sakae brand overseas.
While the number of its restaurants in Singapore will drop to about 30 this year, Sakae has 60-plus more in the region, including 40 in Malaysia.
This year, it will launch up to three restaurants in Myanmar. Sakae has another 80 associate restaurants in the region, in which it has a small stake.
"The Singapore market is very challenging because the general cost of operations, rentals and labour costs have gone up. But the other markets are much more stable," Mr Foo, who is also Singapore Manufacturing Federation president, told The Straits Times yesterday.
"We are also competing with a lot more F&B establishments, which have sprung up in malls as more retail shops close. But all global brands, be it McDonald's or Starbucks, go through the same rationalisation at some time."