Hong Kong fast food chain operator Cafe de Coral reported a modest net profit growth of 9.8 per cent in the first half.

Despite the challenging environment, Cafe de Coral says net profit grew to HK$243 million (US$31.3 million) as revenue rose 8.7 per cent to HK$3.41 billion (US$439.81 million).

The company, whose restaurant brands include Spaghetti House, Oliver’s Super Sandwiches, Manchu Wok, Cafe de Coral, among others, says the first half earnings is lower compared last year, when its net profit increased 16 per cent.

It blamed rising rental costs and labour shortages for the slower growth.

However, CEO Sunny Lo Hoi-kwong remains confident that the company’s customer base will continue to grow as it focuses on its competitive edge by keeping prices low and providing good value.

It has 331 restaurants in Hong Kong and 123 in mainland China.

Looking ahead, it will open 30 new outlets in Hong Kong and 20 in mainland.