Eu Yan Sang's Q3 earnings up 4%, revenue up 9%

EU YAN SANG's net profit for the third quarter ended March rose 4 per cent to $8.79 million from $8.44 million a year ago while revenue rose 9 per cent to $110.28 million from $101.18 million a year ago.

Specifically, retail revenue increased 8 per cent from $83.51 million to $90.41 million. This was contributed by most markets, also due to the increase in company-operated outlets in countries such as Hong Kong and Australia.

Wholesale revenue also rose 20 per cent to $14.79 million, largely attributed to better offtake in trade, which resulted in higher distribution sales to the wholesale distribution channels in Hong Kong and Macau.

Clinic revenue dipped 2 per cent to $4.14 million, mainly due to the impact from the relocation of a clinic in Hong Kong and movements of physicians in the clinics. Earnings per share for the quarter were 1.98 cents versus 1.91 cents a year ago. The group's net asset value per ordinary share was 34 cents as at end March.

For the first nine months to March 31, net profit was flat at $13.4 million while revenue rose 13 per cent to $281.7 million.

The company is optimistic that its strong sales momentum will be sustained for the rest of the year. However, it also expects escalating retail operating costs mainly from rents and payroll increases. Steps taken to manage these operating costs include rationalising its retail network, expanding wholesale, and creating new platforms to reach a wider segment of customers.

"Broadly, the company sees many positive future opportunities, notably from the rising affluence of its target market leading to increased demand, new product development, extensions of wholesale channels and expansion of current manufacturing facilities," said Eu Yan Sang.

Its shares closed trading yesterday up one cent at 85.5 cents.