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Hai-O 1Q earnings slump 57pct to RM7.84m
Sep 29, 2010
Source: The Edge Malaysia
 

KUALA LUMPUR: HAI-O ENTERPRISE BHD’s net profit fell 57% to RM7.84 million in the first quarter ended July 31, 2010 from RM18.52 million a year ago as the multi-level marketing (MLM) division recorded lower revenue.

It said on Wednesday, Sept 29 pre-tax profit was RM10.79 million, down 59% from RM26.28 million a year ago while revenue fell 63% to RM54.75 million from RM148.57 million. Earnings per share were 3.91 sen versus 22.17 sen.

“The effects of applying stringent rules on new members’ recruitment and enhancement of stockists’ management and professionalism since last financial year still need a longer time for the division and distributors to realign their business strategies,” it said.

Hai-O said despite the increased external sales of the wholesale division, pre-tax profit was lower compared to the preceding year as a result of lower profit contribution from its inter-segment sales.

However, the group’s operating profit margin in the current quarter increased by about 2% from a year ago, mainly due to higher margin products sales, the weakening of the US dollar against the ringgit which have contributed in reducing imported costs while operating efficiency improved.