Esthetics' 2Q net profit rises 20.6%, declares 1.5 sen dividend

by **Cals** Wed 18 Nov 2015, 20:34

Esthetics' 2Q net profit rises 20.6%, declares 1.5 sen dividend

By Yimie Yong / theedgemarkets.com | November 18, 2015 : 7:36 PM MYT

KUALA LUMPUR (Nov 18): Cosmetics distributor [size=16]Esthetics International Group Bhd ([You must be registered and logged in to see this image.] Valuation: 1.80, Fundamental: 2.20) saw its net profit rise 20.6% to RM6.9 million in the second quarter ended Sept 30, 2015 (2QFY16), from RM5.7 million a year ago, mainly on higher revenue and a foreign currency translation of RM2.5 million.

Its latest quarterly revenue rose 8.09% to RM41.02 million from RM37.95 million, its filing to Bursa Malaysia today showed.

It declared an interim single-tier dividend of 1.5 sen per share for FY16, payable on Jan 12, 2016.

Esthetics said the higher revenue recorded was due to the group's brand building activities, launch of new products as well as promotional activities.

It noted, however, that the US dollar strengthened by a further 16% against the ringgit during 2QFY16 alone, and was 38% higher than 2QFY15.

This resulted in higher inventory costs for the group as the majority of the group's inventory are purchased in US dollar. Consequently, its profit before tax for 2QFY16 came in at RM5.6 million, 12.8% lower than 2QFY15.

For the six months ended Sept 30, 2015 (1HFY16), Esthetics posted a net profit of RM10.46 million, up 15.2% from RM9.08 million a year earlier.

Esthetics said the beauty and wellness industry is expected to achieve moderate growth over the longer term.

However, should economic conditions deteriorate further, consumer spending, including spending for the beauty and wellness industry in the group's markets, may be impacted over the short term.

"Barring any adverse developments in local and regional market conditions, the board continues to adopt focused and prudent strategies to execute the group's strategic long-term priorities and continue to grow the core brands and businesses of the group," it added.

Shares of Esthetics closed unchanged at 91 sen today, for a market capitalisation of RM168.8 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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