Sheng Siong Group (OV8) Q4 2024 earnings summary

Executive summary

• Revenue for FY2024 increased by 4.5% year-over-year to S$1,428.7 million, driven by new store openings and higher same store sales.

• Net profit rose 2.6% year-over-year to S$137.5 million, with margins remaining stable despite higher operating expenses.

• Gross profit for FY2024 was S$435.5 million, up 6.1% year-over-year, with a gross margin of 30.5%.

• Six new stores were opened in Singapore, and one in China, expanding the total store count to 81.

• Proposed final dividend of 3.20 cents per share, total dividend of 6.40 cents per share for FY2024.

Financial highlights

• Operating expenses increased by 8.8% year-over-year to S$295.0 million.

• Other income increased 20.6% to S$19.2 million, mainly from higher unrealised exchange gains, rental income, and scrap sales.

• Cash flow from operating activities increased 23.7% year-over-year to S$219.0 million.

• Cash and cash equivalents rose 8.9% to S$353.4 million as of 31 December 2024.

• EPS increased 2.9% year-over-year to 9.15 cents.

Outlook and guidance

• Inflation is expected to moderate in 2025, but consumers remain cautious, likely increasing grocery spending.

• The group plans to continue expanding its store network, especially in new HDB areas, and focus on operational efficiency.

• Competition and rising operational costs are expected to pressure margins.

• Government support measures and stable HDB housing supply to enhance consumer purchasing power and support expansion.

• Focus on refining sales mix and improving cost efficiencies for sustainable growth.