KUALA LUMPUR (Nov 18): Clothing designer and retailer Cheetah Holdings Bhd slipped into the red, after posting a net loss of RM1.63 million in its first financial quarter ended Sept 30, 2016 (1QFY17), on the back of lower revenue and higher operation costs such as minimum wages.

This compares to a net profit of RM124,000 in 1QFY16, it said in its bourse filing today.

Operating expenses incurred in 1QFY17 amounted to RM10.99 million, about RM210,000 or 2% more than the RM10.78 million it spent the previous year.

Revenue too slid 16.5% to RM25.6 million during the period, compared with RM30.66 million in 1QFY16, the filing added. The group attributed the drop to Hari Raya festive sales being captured in the same period last year, due to seasonal sales.

There was no dividend paid during the current quarter under review.

On its outlook moving forward, Cheetah said the retail sales sector is expected to deteriorate further in the coming year, before consumer spending and retail sales improve, judging by its 1QFY17 sales. 

“[In the] meantime, the costs of doing business keeps increasing, hence, posing a very challenging time for the company to maintain a positive performance,” the filing said.  

However, the group is taking measures and actions to improve sales of its products and to keep costs in check, in order to turn in a positive performance in the next three quarters of FY17.

In a separate announcement to the bourse, the group was given the nod from its shareholders to renew its authority to purchase its own shares, totalling 85.03 million units during its annual general meeting today.

Cheetah’s shares were untraded today. It last traded 8.9% at 41 sen, for a market value of RM48.17 million.