Better sales in China boosted first-quarter earnings at beauty product distributor Best World International.
Net profit for the three months to March 31 jumped 63.1 per cent to $9.7 million, up from about $6 million in the corresponding period last year. Revenue rose by 27 per cent to $44.7 million, up from $35.2 million a year before, the firm reported yesterday.
"This is mainly due to higher export sales to China, as well as increased sales in Singapore and other markets such as Hong Kong and South Korea, offsetting lower sales in Taiwan," the firm noted.
It said market demand for its DR's Secret skincare range in China continued to grow, lifting export volume for the first quarter to $20.7 million, more than double the $9.8 million in the same period a year earlier.
Best World specialises in the development and manufacture of skincare, personal care, nutritional and wellness products as well as their distribution to customers through its direct selling network in 12 markets.
REVENUE: $44.7 million (+27%)
NET PROFIT: $9.7 million (+63.1%)
The export business contributed 46.2 per cent of first-quarter turnover, while direct selling brought in 51.9 per cent or $23.2 million, and the manufacturing and wholesale segment contributed 1.9 per cent or $862,000.
The firm said the revenue contribution from the direct selling business fell by 4.9 per cent year on year because of lower sales from Taiwan, which offset better performances in Singapore, Hong Kong and South Korea. It added that the total direct selling membership rose 5.6 per cent to 460,195 members as of the end of March, compared with the figure on Dec 31 last year.
Contribution from the manufacturing and wholesale segment fell 9.9 per cent from a year earlier, as the firm held back new product registration amid pending changes to registration requirements, it noted.
By geographical markets, turnover improved the most in China - by 102.7 per cent to $21.4 million - driven by larger shipments during the quarter. "(The) management foresees further increase in repeat consumption among existing users as well as the number of new users for the DR's Secret line of skincare solutions," the firm noted.
It is "cautiously optimistic" that China will be its key growth driver, while the Taiwanese market is expected to be more subdued.
Quarterly earnings per share improved to 3.53 cents, from 2.17 cents a year ago. Net asset value per share was 36.26 cents as of March 31, higher than the 32.91 cents posted at the end of December last year.
Best World shares closed down two cents to $2.79 yesterday, before the results were released.