Achieves Profit Turnaround
HONG KONG, Feb. 12, 2015 /PRNewswire/ —
Nine months ended 31 December
Gross profit margin
Profit/ (Loss) before taxation
Profit/ (Loss) for the period attributable to owners of the Company
Earnings/ (Loss) per share (basic) (HK cents)
RM Group Holdings Limited ("RM Group" or the "Company", HKEx stock code: 8185) and its subsidiaries (the "Group") announced its results for the nine months ended 31 December 2014. During the reporting period, the Group recorded a turnover of approximately HK$157.7 million, representing an increase of approximately 20.9% as compared with the same period last year (2013: approximately HK$130.4 million). It is mainly due to the revenue attributable to health supplements increased by approximately 33.7%. The profit for the period attributable to owners of the Company is approximately HK$14.1 million (2013: loss approximately HK$5.4 million). The profit turnaround is principally attributable to the absence of listing-related expenses.
The Group is principally engaged in the business of formulation, marketing, sales and distribution of health supplements and beauty supplements and products mainly in Hong Kong and Taiwan. The main products for the Group include (i) health supplements and (ii) beauty supplements and products. The Group’s products are mainly sold under its proprietary brands (including "Royal Medic") and private label brands specifically developed for and owned by a renowned retail chain of health and beauty products in Hong Kong and Macau (the "Distribution Facilitator ").
The Group opened its flagship Chinese Medicine Clinic in the Jordan district, Kowloon in October 2014 and currently operates three Chinese medicine clinics, two of which are in Jordan and one is in Quarry Bay, to provide traditional Chinese medicine treatments, services and retailing of health supplements to the general public consumers.
During the reporting period, health supplements remain the major source of income of the Group and have recorded continuous growth in turnover. For the nine months ended 31 December 2014, the Group’s revenue attributable to health supplements increased by approximately 33.7% to approximately HK$132.9 million (2013: approximately HK$99.4 million); while the revenue attributable to beauty supplements and products amounted to approximately HK$24.1 million (2013: approximately HK$30.4 million).
During the reporting period, the Group’s revenue attributable to proprietary brands health supplements increased by approximately HK$19.9 million or 24.8% to approximately HK$100.0 million (2013: approximately HK$80.1 million), was primarily due to increase in sales of the Royal Medic brand products; while the revenue attributable to proprietary brands beauty supplements and products amounted to approximately HK$21.7 million (2013: approximately HK$22.8 million).
Revenue attributable to private label brands health supplements increased by approximately HK$12.4 million or 64.2% to approximately HK$31.7 million. (2013: approximately HK$19.3 million), was primarily due to the expansion of the product range and several existing popular private label brands products, which previously were only sold at SDCs, were introduced to be sold on shelves in the stores of the Distribution Facilitator as well. The Group focused its product development in other segments during the period, as a result, revenue attributable to private label brands beauty supplements and products decreased to approximately HK$2.3 million (2013: approximately HK$7.6 million).
Mr. Mark Chan, Chairman and Chief Executive Officer of the Group, said, "we are optimistic in the Group’s future prospects. The Group will continue to drive turnover growth by placing strong emphasis on a multifaceted marketing strategy through utilising various media and channels, such as television commercials, printed media, digital media, outdoor advertising, in-store promotion, the Wisdom Club and product road shows. We also intend to expand its distribution network in Hong Kong selling products through other distribution facilitator’s stores as well as establishing its own stores. In addition, the collaboration with CUCAMed Company Limited, not only enhances the product portfolio of the Group but also increase brand recognition of Royal Medic. We will continue to develop and promote products under the brand ‘LEGEND’. On the overseas markets front, in order to improve the sales performance and reduce costs in Taiwan, the Group is in negotiations with potential distributors in Taiwan to promote and sell the Group’s products. At the same time, the Group’s products will continue to be sold in the stores of the distribution facilitator in Taiwan, on a non-exclusive basis, without the use of promoters. The Group is also exploring opportunities in China and other markets in Southeast Asian countries."
About RM Group Holdings Limited
RM Group Holdings Limited is principally engaged in the business of formulation, marketing, sales and distribution of health supplements and beauty supplements and products under its proprietary brand (including "Royal Medic") and private label brands specifically developed for and owned by a renowned retail chain of health and beauty products in Hong Kong and Macau (the "Distribution Facilitator"). The Group outsources most of its production to its suppliers and subcontracting manufacturers and the Group distributes its products mainly through the Distribution Facilitator. According to the industry report prepared by Ipsos Hong Kong Limited, the Group ranked third as a PCM health supplements provider in Hong Kong in 2012, with a market share of 10.4% in terms of retail sales value. According to the report of the independent global marketing research company, its best-selling product, Royal Medic Cs-4, ranked first in terms of sales value in the Cordyceps market in Hong Kong for five consecutive years ended August 2013.