Financial Performance - The Group registered greater growth in FY2022 compared to FY2021, reflecting recovery from the COVID-19 pandemic [10]. - The Group recorded consolidated revenue of approximately S$47.3 million for FY2022, representing an increase of approximately 26.5% from S$37.4 million in FY2021 [36]. - The consolidated net profit after tax for FY2022 was approximately S$5.7 million, an increase of approximately 23.9% from S$4.6 million in FY2021 [37]. - The Group's revenue increased by approximately S$9.9 million or 26.5% from S$37.4 million in FY2021 to S$47.3 million in FY2022, primarily due to increased rental income and sales of cooked food, beverages, and tobacco products [112]. - Revenue from the sale of cooked food, beverages, and tobacco products increased by approximately S$6.7 million or 23.1%, from approximately S$28.9 million for FY2021 to approximately S$35.6 million for FY2022 [109]. - Rental income increased by approximately S$1.8 million or 30.5%, from approximately S$6.0 million for FY2021 to approximately S$7.8 million for FY2022 [110]. - Revenue from management, cleaning, and utilities services increased by approximately S$1.4 million or 56.6%, from approximately S$2.5 million for FY2021 to approximately S$3.9 million for FY2022 [111]. Operational Expansion - The Group opened a total of 22 new stalls in 2022, expanding its operations to 23 F&B establishments, 15 beverage stalls, and 47 food stalls [22]. - The second "Food Dynasty" brand food court opened in March 2022 at Bras Basah Road, located in a vibrant shopping and cultural district [18]. - Almost all food stalls were onboarded with at least one delivery platform in 2022, despite increasing platform fees, indicating a growing trend in food delivery demand [16]. - The Group aims to expand its presence by opening more food establishments and seeking acquisitions of promising F&B businesses [31]. - The Group will continue to expand its presence in Singapore by opening new food establishments and renovating existing food centres [107]. Cost Management - Rising bank interest rates and supply chain disruptions have led to increased costs, including a S$2.4 million rise in staff costs and a S$2.2 million increase in inventory costs [28][37]. - The Group continues to enhance its costing strategies to manage operational expenses without compromising quality amid rising raw material prices [29]. - Staff costs rose by approximately S$2.4 million or 22.8% to S$12.7 million in FY2022, accounting for approximately 26.8% of revenue [121]. - The cost of inventories consumed increased by approximately S$2.2 million or 16.8% to S$15.5 million in FY2022, in line with revenue growth from food and beverage sales [120]. Strategic Initiatives - The Group acquired First Capital Pte. Ltd. in May 2022 to redevelop its property into an 8-storey food factory, with construction expected to commence in 2023 [23]. - The Group plans to divest underperforming assets to unlock capital for reinvestment in the F&B business and complementary growth areas [107]. - The Group plans to utilize the unutilized net proceeds by the year ending December 31, 2024, based on actual business needs and future development [164]. Leadership and Governance - The Group's management team has extensive experience in the food and beverage sector, contributing to its operational success [54][59]. - The Board of Directors consists of six members, including three executive directors and three independent non-executive directors, with no changes in composition during FY2022 [187]. - The Group is committed to high corporate governance standards and has complied with all applicable code provisions of the Corporate Governance Code during FY2022, except for a specific deviation disclosed in the report [170]. - Independent non-executive directors provide independent judgment and advice on overall management and lead in potential conflicts of interest [195]. Community Engagement - The Group has a commitment to community engagement, including providing scholarships and food vouchers to disadvantaged families [48]. - The Group continues to collaborate with community centers to enhance social support and public information initiatives [48]. - The Group expresses gratitude to stakeholders, including suppliers, clients, and the Singapore Government, for their support during challenging times [46][50]. Challenges and Outlook - The operating environment for the F&B sector may face challenges from rising food prices, tight labor market conditions, and increasing interest rates [106]. - The Group expects a steep increase in manpower costs for 2023 due to intensified competition for skilled labor [24]. - The Group acknowledges the impact of COVID-19 and highlights government support measures that provided relief and assistance to the business and employees [46][50].
K2 F&B(02108) - 2022 - 年度财报