Salim's unit to expand supermarket chain

Salim's unit to expand supermarket chain

SINGAPORE (Bloomberg): QAF Ltd., a Singapore food company controlled by Indonesia's Salim group, expects to top analysts' estimates for 1999 profit, and plans to expand its supermarket chain in the city state and elsewhere in Asia.

QAF, which makes bread under the Gardenia brand and operates the Shop N Save chain of supermarkets in Singapore, is expected by analysts to have earned 4.1 cents a shares last year.

"We should do very much better than (that)," Managing Director Tan Kong King said in an interview.

He said sales from the company's 25 Shop N Save supermarkets in Singapore -- which accounts for half of total sales -- will likely rise 30 percent in the year ended December, boosted by renewed consumer spending.

Stronger earning will enable QAF to push plans for expanding its supermarket business in Singapore and elsewhere.

To tap rising demand, QAF is planning to open up to six new supermarkets in Singapore this year. It will shut by March, its unprofitable outlet at the Suntec City shopping mall near the island's business district, he said.

The company, which doesn't yet operate supermarkets outside Singapore, plans to make forays into markets such as the Philippines, Indonesia and China with Belgium's largest retailer Delhaize-Le Lion SA, which owns a 49 percent stake in Shop N Save, Tan said, declining to provide details.

QAF's profit before a charge in 1998 was S$10.8 million, or 3.4 cents. Sales rose 7 percent to S$404 million.

Indonesia's Salim group, headed by tycoon Liem Sioe Liong, owns a 44.2 percent stake in QAF while the Indonesian Bank Restructuring Agency, or IBRA, holds a 24.3 percent stake.

Tan declined to comment on speculation IBRA was looking to soon sell its stake in the company.