ZEN records Q1/2019 net profit of THB 32.1m, up 33%, gears up for expansion of Thai and Japanese restaurants in Q2 as planned
ZEN Corporation Group PLC (“ZEN”) announces operating results for Q1/2019, showing a net profit of THB 32.1 million (up 33%), with earnings of THB 730.5 million (up 2%), thanks to the addition of more branches and higher-than-expected sales from delivery services of every brand. More branches of Thai and Japanese restaurants will be opened in Q2, both at department stores and in other locations, including in major economic provinces and community areas. Existing restaurants will be renovated to attract more customers.
MR BOONYONG TANSAKUL, CHIEF EXECUTIVE OFFICER (CEO) OF ZEN CORPORATION GROUP PCL (“ZEN”), a food service company, disclosed the overall operating results for Q1/2019 (January to March 2019). The company recorded total earnings of THB 730.5 million, with a net profit of THB 32.1 million, up 2% YoY, from THB 715.9 million, and 33% YoY, from THB 24.1 million, respectively. The growth is despite of a slowdown in the overall economy and a decline in consumer spending, as compared to the previous year.
First-quarter earnings increased due to the expansion of more branches of both Japanese and Thai restaurants, under the brands ZEN, AKA, On The Table, KHIANG, etc. Furthermore, every brand reported growing sales from delivery services, which were higher than expected, because these services responded to the need for convenience and a hurried lifestyle. The company therefore adjusted its 2019 sales target from delivery services, from THB 30 million to THB 100 million.
The impressive profit in the first quarter was also a result of the company’s focus on cost management and efficient control of selling, general and administrative expenses (SG&A), such as by minimizing the waste of raw materials during production, negotiating prices of raw materials, etc.
ZEN’s CEO said for Q2/2019 he was confident that the growth would continue. The company plans to open more Japanese and Thai restaurants every month, both at department stores and in other locations, including in major economic provinces. In addition, more restaurants of smaller sizes will be introduced in community areas, community malls and lifestyle malls. In April, the company had a total of 271 restaurants.
Meanwhile, the company will also renovate its existing restaurants under the brands ZEN, AKA and On The Table at good locations to attract more customers in a bid to boost average monthly sales. This is expected to promote growth of the existing restaurants. Furthermore, the company will team up with new partners to hold joint sales promotional campaigns in order to expand its customer base.
“For Q2, we will continue to invest in new branches. Leading department stores that are planning to open at more locations are interested in having our restaurants at their new locations, because we now have as many as 12 restaurant brands, all of which are well known and popular among consumers. Moreover, we have partnered with PTT service stations to open KHIANG Thai street food restaurants, which have been well received,” said Mr. Boonyong.
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