Kimly, the largest traditional coffee shop operator in Singapore, posted a 20 percent fall in third-quarter net profit due to higher staff costs and operating leases as the group expands its operations.
Net profit attributable to owners of the company fell to S$5.2 million in the three months ended June 30 compared to S$6.5 million in the corresponding period last year.
Revenue for the quarter gained 8.5 percent to S$47.9 million, boosted by higher sales from cooked food and beverages and an increase in rental income.
Kimly operates and manages 59 coffee shops and four industrial canteens under the Kimly and third party brands.
The group's selling and distribution expenses rose 8.8 percent to S$0.7 million due to higher packaging materials and other expendables.
Administrative expenses for the quarter shot up 20 percent.
The group expects its operating environment to remain challenging due to the shortage of qualified individuals with requisite skills, as well as stiff competition within the food and beverage industry, it said in a statement after maker hours.
Shares in the company closed unchanged at S$0.375 on the Singapore Exchange.