Retailer FJ Benjamin Holdings' FY2025 net loss has widened to $16.6 million from $6.1 million in the preceding year ended June 2024.

 

Revenue in the same period was down 24% y-o-y to $60.46 million, due partly to the closure of non-profitable stores, as well as persistently weak consumer sentiment.

 

" A strong Singapore dollar further contributed to increased outbound travel and overseas spending, dampening domestic retail demand," the company says.

 

The company managed to cut costs via a combination of reducing headcount, closing stores, reduce marketing and so on.

 

FJ Benjamin says that the retail sector continues to face headwinds amid weak consumer demand, rising operating costs and intensifying competition, particularly in its key markets of Singapore and Malaysia.

 

Currency volatility and the ongoing shift in consumer spending patterns, including increased overseas purchases, are expected to continue influencing market dynamics.

 

On Sept 5, FJ Benjamin announced that it will stop carrying Guess, a US fashion brand by end of 2025.

 

" Given that Guess is a significant brand within the group&rsquo s portfolio, the board expects that the anticipated cessation of this brand relationship will have a material impact on the group&rsquo s performance for the financial year ending June 30 2026," says FJ Benjamin.

 

FJ Benjamin says it will place its emphasis on right-sizing its operations to improve operational efficiency.

 

It will also actively pursue new growth opportunities across both retail and food & beverage segments and explore strategic collaborations to support expansion into more cost-efficient markets.

 

" Going forward, the group remains committed to curating a portfolio of brands aligned with local consumer preferences, while executing a strategic roadmap focused on long-term profitability and sustainable growth," says FJ Benjamin.

FJ Benjamin will stop retailing and distributing Guess products in Malaysia and Indonesia by Dec 31, says the SGX-listed group on Sept 5.

 

This comes after the group&rsquo s wholly-owned subsidiary, FJ Benjamin (Singapore), and Guess Europe Sagl, have mutually agreed to end their relationship.

 

According to the group, the retail and distribution of Guess products is with FJ Benjamin (M), the group&rsquo s subsidiary in Malaysia and PT Gilang Agung Persada, the group&rsquo s associated company in Indonesia.

 

These companies will each enter into a sale and purchase agreement with the new distributor for Malaysia and Indonesia.

 

As Guess is a &ldquo significant&rdquo brand within FJ Benjamin&rsquo s portfolio, the group expects that the move is likely to have a material impact on its financial results.

 

&ldquo The board wishes to thank Guess for its long partnership and will work together with the new distributor to ensure a seamless transition of the Guess business,&rdquo says the group.

 

FJ Benjamin Holdings has posted a loss of $6.1 million for its FY2024 ended June, reversing from the earnings of $3.5 million in FY2023.

 

The net profit in FY2023 included a write back of allowance for expected credit losses of $625,000 and a foreign exchange gain of $666,000 compared to a foreign exchange loss of $142,000 recorded in FY2024.

 

For the 2HFY2024, the company recorded a loss before tax of $3.9 million, compared to a profit before tax of $2.1 million in the previous corresponding period.

 

Revenue for FY2024 was down 9% y-o-y to $78.4 million. Sales for the full year in Singapore and Malaysia were down 23% and 9% y-o-y respectively. 

 

Gross profit margin dropped by 4.2 percentage points to 48% from 52.2% as the company had to drive sales with additional promotions amid weaker consumer demand. 

 

Meanwhile, group operating expenses declined by 4% to $41.2 million in FY2023. This follows lower staff costs from store closures and lower staff commission among others.

 

Moving forward, the company will continue to manage costs and maximise market opportunities of its portfolio of fashion and wellness brands.