Fast-food chain operator Cafe de Coral Holdings says its loss-making restaurants in Hong Kong have turned the corner but warns its mainland outlets will struggle to break-even this year. Managing director Michael Chan Yue-kwong said Chinese food chain Ah Yee Leng Tong, which had been responsible for most of the company's problems, generated a profit in the first half following the closure of loss-making stores. He said the company had shut down 'some outlets' in the past 12 months and now had a total of 11 Ah Yee Leng Tong restaurants. 'Following the consolidation, we now plan to open one or two new outlets by the end of the year. Each will cost $2 million to $3 million,' Mr Chan said after its annual shareholders meeting. The company's restaurants - Ah Yee Leng Tong and The Spaghetti House - generated about 10 per cent of $126.23 million earnings before exceptional items and tax for the year to March. 'Most of the profit came from 18 outlets of The Spaghetti House, as the size of the investment involved was lower than for the Chinese food chain,' Mr Chan said. A sharp downturn in the mainland catering market has made life difficult for Cafe de Coral, he said. Its mainland operations lost about $14 million last year but have recovered recently. 'We have lowered spending per head by between 20 and 30 yuan from 30 to 40 yuan, which is the level similar to an American fast food chain. As a result we hope to see our cash flow break even this year,' Mr Chan said. He added, a $200 million three-year syndicated loan was expected to be launched by the end of the month. He said the company planned to invest the money in new outlets for its core fast food chain Cafe de Coral, expanding the institutional catering arm and cultivating a possible catering business at the new Chap Lap Kok airport.