GAP exit brings ex parent some turning wheel of fortune
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Singapore retailer FJ Benjamin has recorded a change of fortune, turning its first annual profit in four years.
The multi-brand retailer reported a pre-tax profit of S$939,000 for the year to June 30, compared to a loss of $16.5 million the previous year.
“We are encouraged by our 2018 operating results,” said CEO Nash Benjamin. “With improved consumer sentiment, we witnessed comparable store growth in most of our brands as well as full-year contributions from new stores opened during 2017.”
He said the company will now focus on growing the business organically with improved merchandise assortments and the implementation of a new Customer Relationship Management system.
Sales in Singapore and Malaysia last year grew by $16.2 million, however due to the discontinuation of a business overall revenue declined $39.9 million. The company shuttered its Gap and Banana Republic stores in February after opting not to renew the licence.
Gross profit margin improved four percentage points to 46 per cent due to higher margins from retained brands and the discontinuation of the less profitable labels.
Nash Benjamin said FJ Benjamin continues to evaluate prospects for introducing new brands into its portfolio.
Questions & Answers
Q.What contributed to the decline in overall revenue despite sales growth in Singapore and Malaysia?
What contributed to the decline in overall revenue despite sales growth in Singapore and Malaysia?
Overall revenue declined by S$39.9 million due to the discontinuation of a business. This happened despite sales growing by S$16.2 million in Singapore and Malaysia last year.
Q.Which specific brands did FJ Benjamin discontinue and when did this occur?
Which specific brands did FJ Benjamin discontinue and when did this occur?
The company shuttered its Gap and Banana Republic stores in February. This decision was made after FJ Benjamin opted not to renew the licensing agreements for these brands.
Q.How did the discontinuation of certain brands affect the company's gross profit margin?
How did the discontinuation of certain brands affect the company's gross profit margin?
The gross profit margin improved by four percentage points, reaching 46 per cent. This improvement was a result of higher margins from retained brands and the discontinuation of less profitable labels.
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