Fairwood blames beleaguered Mario chain for loss-making year
Fast-food chain operator Fairwood Holdings yesterday revealed its third straight loss-making year reporting a $122 million net loss for the year to March 31, compared with a $88.2 million net loss last year.
Managing director Dennis Lo Hoi-yueng attributed the loss to the beleaguered Mario chain, which he said had dragged down the entire company.
Fairwood's net losses include a $50 million provision for the Mario restaurant chain, which was sold in July for $37 million.
Mario's losses accounted for 60 per cent of the group's total losses. Turnover for the group has stalled at $1.3 billion for the past two years.
'If you take away Mario from the year's results, you can see that Fairwood is in a much healthier situation,' Mr Lo said.
The company's core Fairwood fast-food business of 94 Hong Kong restaurants reported a profit of $6.3 million against a $3.3 million loss a year earlier.
On the mainland - where Fairwood has 24 restaurants - the company saw sales revenue decrease 12 per cent to $121 million, resulting in an operational loss of $39 million.
Three Fairwood restaurants were closed last year and one more is due to be closed this year.
Deputy managing director Ng Chi-keung said the company had debt of about $100 million. There will be no dividend this year.
Mr Lo said that provisions to close restaurants will likely affect results in the coming year.