A Look At The Food Catering Company, Neo Group

neogroup logo Whether it’s just a simple get together or celebrating a joyous occasion, it is common for Singaporeans to engage catering services. One such company in Singapore is Neo Group Limited (SGX: 5UJ).

Listed on 11 July 2012, Neo Group is one of the largest events caterer in Singapore and has 3 brands under their Food Catering Business – “Neo Garden Catering”, “Orange Clove” and “Deli Hub”. The reason for 3 different brands is part of its brand diversification strategy to offer buffets with a wide variety of styles and prices, to suit a diverse range of occasions.

Neo group food catering biz

Some consumers may be familiar with Neo Group’s food retail business under the “Umisushi” brand, a Japanese convenient-food outlet serving the busy working adults or students looking for a simple and affordable meal. Neo Group operates 18 of such food retail outlets located in accessible locations near MRT stations and in shopping malls with high human traffic.

In order to support the expansion of the businesses without comprising on quality, Neo Group owns central kitchens in four locations and a fleet of 124 vehicles to provide timely delivery to all of Singapore. In a bid to ensure a constant supply of food ingredients and catering items at a lower cost, the company sources directly from manufacturers and distributors.

Besides delivering food, Neo Group has also delivered consistent revenue and profit growth more than 30% CAGR throughout the years. It currently trades at $0.43, up 43.3% from its IPO price of $0.30. It has a 3.49% dividend yield but sports a relatively high P/E ratio of 20.5. The future plans undertaken by the management team include increasing production capacity, opening more “Umisushi” outlets and through acquisitions, joint ventures.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.   Motley Fool Singapore contributor James Yeo doesn’t own shares in any companies mentioned.