Ajisen Ramen operator Japan Foods warns of ‘substantial’ full-year loss

[SINGAPORE] Japan Foods announced on Monday (May 5) that it expects to report a “substantial net loss” for FY2025 ended Mar 31, based on a preliminary review of the group’s unaudited management accounts.

The food and beverage group – whose brands include Ajisen Ramen and New ManLee Bak Kut Teh – blamed the poor performance on:

• weak sales caused by market saturation and challenging macroeconomic conditions;

• higher selling and distribution expenses due to increased manpower cost, utilities expenses, rental and depreciation charges; and

• impairment loss relating to non-performing outlets and write-off of fixed assets relating to the closure of certain outlets.

Further details of its financial performance will be disclosed when it announces its unaudited results.

On Feb 6, Japan Foods reported that higher operating costs pushed it into a net loss of S$2.9 million for the nine months ended Dec 31, 2024, compared with a net profit of S$668,000 previously.

Revenue fell 0.6 per cent to S$64.9 million due to weak sales in November and December 2024.

The group also recorded an allowance of S$680,000 for impairment loss on a loan to a joint venture (JV) company, Dining Collective. It has decided to wind down the JV after reviewing the latter’s performance amid challenging market conditions.

In the May 5 statement, the group advised its shareholders and investors to exercise caution when dealing in the shares of the company.

Shares of Japan Foods closed flat at S$0.27 on Friday.