The operator of Starbucks in Malaysia saw its net loss plunge to a record low as customers shunned the iconic American coffee brand as a form of protest against the Gaza conflict.
Berjaya Food Bhd’s net loss more than tripled to RM292 million (US$69 million) for the financial year that ended in June, the company reported.
Its revenue fell 36% year-on-year to RM477 million.
The company attributed the results to “the prolonged impact of the ongoing sentiment related to the Middle East conflict, which affected market dynamics and influenced customers’ spending patterns,” it said in the report.
“As a result, Berjaya Food was required to make “the necessary impairment provision” to property, plant and equipment as well as right-of-use assets arising from the downsising of Starbucks Malaysia’s operations,” it added.
The impairments swelled by nearly six times to RM152.8 million, the report showed.
Fast-food brands from the US saw boycotts intensify since last year due to their perceived links to Israel amid fighting in Gaza.
Starbucks CEO Brian Niccol, during his first visit to the Middle East since becoming CEO last year, said the boycotts were “not based on anything that’s accurate or true”.
“We’ve never supported any militaries,” he added.
