Mainland growth mitigates tough Hong Kong market for Tsui Wah
New stores in Mainland China helped mitigate a tough consumer market in Hong Kong for listed restaurant-operator Tsui Wah Group.
The company ended the year with 70 restaurants – a net increase of five in Mainland China, one in Hong Kong and an unchanged three in Macau.
Total revenue reached HK$1.84 billion (US$234.5 million)for the year to March 31, down by a marginal 0.3 per cent with a 4.3 per cent decline in Hong Kong offset by a 7.8 per cent increase in Mainland China. Profit attributable to shareholders fell 11.4 per cent to $80.77 million.
Chairman and executive director Lee Yuen Hong said the retail market in Hong Kong experienced “a progressive improvement” during the period, however, selling and distribution expenses as well as property rental and related expenses had increased, which presented challenges to the group’s results.
“The PRC market benefitted from rising purchasing power amongst the general population, and the revenue from the group’s branches in Mainland China also correspondingly increased.”
Tsui Wah launched two new self-developed brands last year: Beat Bakery, which uses flour imported from Japan with healthy eating as its core theme, and Nijuuichi Don, featuring Japanese fast-food.
The group also opened a new restaurant concept, Maomao Eat, which serves authentic Hong Kong-style snacks in the Tai Kwun Centre for Heritage and Arts, in Central. “Maomao Eat also incorporates vegetarian elements in its menu by partnering with Green Monday, a non-profit organisation that promotes a healthy diet and sustainable living,” he said.
The company opened eight new Tsui Wah branches in Hong Kong and Mainland China, three in Shanghai, and three in the south.
Tsui Wah also sealed a partnership with Singapore’s Jumbo Group to open and operate a Hong Kong-style Cha Chaan Teng under the Tsui Wah brand. Hong said the restaurant, which opened in mid-June, leverages off Jumbo’s strong presence in Singapore.
“The group is confident this joint venture will be successful and will enable Tsui Wah and its products to establish an excellent international reputation among the 5.6 million residents of Singapore.”