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Singapore’s Big Winner for the Week: F J Benjamin Holdings Ltd

F J Benjamin Holdings Ltd’s (SGX: F10) shares have gained 2.6% since last Friday to close at S$0.12 for the week. Given that the Straits Times Index (SGX: ^STI), Singapore’s market barometer, had moved in the opposite direction, F J Benjamin is certainly a big winner.

The company, which started the well-known local fashion brand Raoul, released its financial results for its fiscal third-quarter ended 31 March 2015 recently.

Revenue declined by 23% from S$90.3 million a year ago to S$69.7 million in the reporting quarter. F J Benjamin attributed the showing to weak consumer sentiments in Singapore and North Asia and a slowdown in the Chinese economy.

The challenging market conditions hit the company’s bottom-line as well. F J Benjamin took a loss of S$7 million for the quarter, as opposed to a loss of S$4.9 million a year back. The firm had cut down its operations in Hong Kong and Taiwan, and shuttered stores that were not raking in profits in Singapore and Malaysia.

Management revealed that the closure of unprofitable stores will not be completed till the end of 2015. It expects to clock a loss for the whole of the financial year ending 30 June 2015 (FY 2015).

FY 2014 did not end well for F J Benjamin either. The company suffered an annual loss of S$20.8 million back then, its first unprofitable year for a long time. In the press release for FY 2014’s earnings, F J Benjamin’s management commented:

“Looking ahead, the Group does not expect a meaningful upturn in sentiment and consumer spending in the key markets of Singapore, Malaysia and North Asia in the near to medium term”.

Only time will tell if and when the company will be able to turn its business around. Over the past five years, shares of the retailer have been languishing; they have in fact, fallen some 60% since May 2010. In comparison, the Straits Times Index has put on 26% over the same time frame.

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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 Sudhan P doesn’t own shares in any companies mentioned.