Second Chance sees 1Q net profit drop by half

SINGAPORE (Dec 30): Lower sales from Second Chance Properties’ apparel, properties and securities business cut its 1Q17 net profit by half to S$1.26 million from a year ago.

Revenue for the quarter ended Nov fell 9.8% to S$7.4 million (RM22.9 million).

Sales from the apparel business fell 32.2% to S$1.2 million due to the closure of 11 shops in Malaysia during the quarter, the weakening Malaysian ringgit and higher competition.

Sales from the properties business fell 11.2% to S$1.9 million due to loss of rental income from the sale of four investment properties during the quarter as well as lower rentals received on some lease renewals.

Sales from the securities business fell 5.7% to S$1.01 million.

Its gold business was the only segment that saw a 1.5% rise in sales to S$3.31 million.

Second Chance said the introduction of GST and the weakening ringgit on top of the political situation in Malaysia have led to a drastic drop in consumer spending badly hitting the retail industry.

“Our apparel business in Malaysia has deteriorated further and we expect continued losses during the year. In order to mitigate these losses, we will be closing at least 10 stores in this financial year,” says the group.

However, the group expects the apparel business in Singapore and the gold business to remain profitable.

Shares of Second Chance closed flat at 23.5 Singapore cents. — theedgemarkets.com.sg