Vitasoy International 0345

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Vitasoy's profit surges 155pc as mainland market recovers

Vitasoy International's (0345) net profit surged 155 percent to HK$116 million for the year ending in March from a year ago, thanks to the strong recovery in mainland China.

It declared a final dividend of 6.3 HK cents per share, 350 percent higher than a year earlier. Together with the interim dividend, the total dividend for the year came in at 7.7 HK cents.

Total revenue dipped 2 percent to HK$6.22 billion during the year amid the weakening yuan and Australian dollar. If the currency impact is excluded, its revenue would have risen 1 percent over the previous year.

Gross profit margin increased 2.5 percentage points to 50 percent.

Profit from mainland operations surged 402 percent in local currency terms, driven by higher pricing, efficient promotions and effective control of operating expenses.

Vitasoy's Hong Kong businesses increased by 3 percent in profits during the period. If excluding Covid-related government subsidies, profit from local operations would have grown 42 percent thanks to efforts in reducing material and production costs.

Its Australia and New Zealand operations saw declining revenue and recorded an operating loss of AU$16 million (HK$83.3 million) due to an out-of-stock situation partly arising from logistics issues.

Source: The Standard

https://www.thestandard.com.hk/section- ... t-recovers

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<Research>Macquarie Cuts VITASOY INT'L (00345.HK) TP to $9.5, Rating Outperform

VITASOY INT'L (00345.HK) reported a 6% organic sales growth in 2HFY24, vs a 3% decline in 1HFY24, Macquarie said in its report, attributing this to improved business in Mainland China and strong performance in Hong Kong, which offset the negative impact of New Zealand business.

The broker expected VITASOY to focus on margin improvement in the future.

Gross margin for 2HFY24 will add by 2.3 ppts YoY to 49.5%, above the broker's forecast of 48.7%, on the back of the product price adjustments and discount reductions.

The broker anticipated that the management will further improve profitability by FY25 through more precise marketing, cost control and operational leverage.

Related News: VITASOY INT'L Annual NP $116M, Up 1.5x+; Final DPS Lifts to 6.3 Cents

In light of the latest results and the macroeconomic outlook, Macquarie lowered its net profit forecast for FY25-26 by 8.8% and 9.6% respectively, and cut its TP from $10.5 to $9.5, rating the company Outperform.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN