- We remain positive on Sheng Siong as we see growth fuelled by new outlet wins, the performance of its new stores, and better operating efficiency with plans for a new distribution centre.
- Outlook is positive, based on domestic supermarket consumption, new store outlook, and its China operations.
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3Q23 earnings in line.
- Sheng Siong (SGX:OV8)'s 3Q23 earnings of S$35m (+6% y-o-y) and revenue of S$346m (+4% y-o-y) were in line, albeit within 2.5% below our expectations.
- Revenue growth was largely led by six new stores – which opened between FY22 and 9M23 – at +2.2% y-o-y, while SSSG increased by 1.8%. Annualised sales per sq ft remained robust, growing 1% y-o-y to S$2,237.
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- China operations were profitable – excluding its fifth store, which only opened this year, its four stores there are all profitable.
Outlook is still positive.
- Read more at SGinvestors.io.
