SINGAPORE - Massage chair maker OSIM International posted a sharp 27.8 per cent drop in third-quarter net profit from the previous year to $16.4 million on Tuesday.

This was despite sales rising 3.4 per cent to $153 million for the three months to Sept 30 compared with last year.

Higher wages and rental costs were partly responsible for the drop in earnings, the lifestyle group said in a statement.

It also said that operating expenses were also higher because of "startup and legal costs" at its subsidiary TWG Tea.

However, the group said that it had had 22 consecutive quarters of record profit, and has a strong balance sheet after its recent issue of convertible bonds.

It said that it has "embarked on a period of increased investment" across the group especially at TWG Tea and OSIM.

New TWG Tea outlets have opened with supporting infrastructure including central kitchens, offices, warehouses and employees, it added.

Earnings per share fell to 2.11 cents in the quarter, down from 3.14 cents the preceding year. Net asset value per share was 55 cents as at Sept 30, higher than the 36 cents as at Dec 31 last year.

The board has proposed an interim dividend of one cent per share.

OSIM shares fell seven cents to $2.25 on Tuesday before its results were announced. The Singapore Exchange queried the company earlier this month about an unexplained tumble in the counter for two consecutive days, to which OSIM replied that it did not know why that had occurred.