Sheng Siong Earned 83.7% More in 2020 Compared to 2019; Sales Driven by COVID-19

We all know that unlike most businesses, Sheng Siong made a killing during the COVID-19 pandemic.

So much so that they are allegedly able to give their employees up to 16 months’ bonus.

But exactly how much did Sheng Siong earn?

All that and more will be revealed in this article.

Sheng Siong Earned 83.7% More in 2020 Compared to 2019; Sales Driven by COVID-19

On 24 Feb 2021, it was revealed that Sheng Siong earned a whopping S$139.1 million in net profit for the year ending 31 Dec 2020.

That’s an increase of 83.7% compared to the year before.

This exemplary performance is due to two factors – the opening of five new stores and the COVID-19 pandemic.

According to a media statement, three-quarter of the increase in profits comes from existing stores while a quarter comes from the new outlets.

When Singapore raised its DORSCON level to Orange on 7 Feb last year, demand at their outlets increased.

Which isn’t surprising, considering the spate of panic-buying that happened here in Singapore.

Then, the Circuit Breaker was imposed.

Even when the Circuit Breaker was lifted, demand remained high as people were asked to stay home as much as possible.

Expansion Plan Still On Track

While many businesses have been cutting cost due to the pandemic, Sheng Siong is one of the few who decided to go full steam ahead.

“Despite facing some delays in opening new stores and challenges arising from the outbreak of Covid-19, our expansion plan is still on track.”

In 2020, Sheng Siong opened 5 new outlets, bringing the total number of Sheng Siong outlets to 63.

The new stores include one at Block 872C Tampines Street 86 and another at Block 455 Sengkang West Avenue.

While demand for its goods has lowered in the second half of 2020, it is still higher than pre-COVID-19 levels.

Sheng Siong will continue to look for retail space in new and existing HDB, especially in areas that don’t have Sheng Siong presence.

So if you’ve always wanted a Sheng Siong outlet near you, your wish might just come true.

Savings During COVID-19 Pandemic

The supermarket chain’s revenue has increased by 40.6 per cent year-on-year.

While administrative costs increased by S$72.6 million throughout the 12 months, the cost was defrayed by lower rental and property tax due to the government’s assistance to businesses.

The reason why administrative costs increased is due to having more people working longer hours and higher bonuses.

Whether Sheng Siong will remain flying high depends on how the COVID-19 pandemic progresses.

They fully expect government assistance to businesses to reduce but will have to wait and see how prices are affected due to disruptions in supply lines.

For those who hold Sheng Siong shares, you might just be looking at a 3 cents per share dividend, pending shareholder approval.

On a separate note, did you know that the owners of Sheng Siong became billionaires due to COVID-19?

Feature Image: kandl stock / Shutterstock.com