Eu Yan Sang profit dives 95% in Q3 to $290k; declines comment on privatisation rumour

Mr Richard Eu, Group CEO of Eu Yan Sang International.
Mr Richard Eu, Group CEO of Eu Yan Sang International.ST PHOTO: RAJ NADARAJAN

SINGAPORE - Traditional Chinese medicine group Eu Yan Sang's profits were battered by currency fluctuations even as the company grappled with a weaker business environment,

The company's profits dived to just $290,000 in the three months to March 31, down 95 per cent from the same period last year.

Revenues were also down by 6 per cent to $103.9 million in the same period.

But the weaker performance did not stop the firm from declaring a dividend of about 2.5 cents.

The company, which requested for a trading halt last Tuesday, did not address rumours that it could be looking to de-list from the Singapore Exchange.

A company spokesman declined comment when asked about the rumours.

Eu Yan Sang's chief executive Richard Eu said that he remained optimistic, noting that the company is seeing "green shoots" in some of their markets.

The firm blamed the weak currency in Hong Kong, Malaysia and Australia as key reasons for the lower profit and revenue levels.

But it has met some success with its cost-reduction drive, one which has resulted in lower operating expenses.

Mr Eu also warned that weak macroeconomic conditions are weighing down market performance in both Hong Kong and Malaysia.

"Deterioration in these markets may affect our business outlook for our fourth quarter," he added.

Net profit for the nine months ended March 31 also fell 92 per cent to $634,000, compared with the same period a year ago.

The firm also added that it will take a cautious approach and is looking to further reduce costs, which includes reviewing on non-profitable business lines while looking to improve efficiency.

"The Group will also continue to review its cash flow and funding requirements to ensure its balance sheet remains sufficiently strong to support future growth," said the firm.