please be more professional. Buy shares only; no need buy until curse people ppl. Seem like @SCK82 buy shares until want bankruptcy liao. Maybe he is the one holding all the call warrants
The icing on the cake here is of course the unexpected announcement of 2nd interim dividend. This shows the cash flow of HaiO is very strong. Very generous too.
Althought overall net profit increase RM4 mil compare previous year quarter,but revenue & net profit for MLM decrease 4.9% & 15% respectively.pls take note.
MLM division The revenue decreased by about 4.9% to RM 75.5 million as compared to the preceding year’s corresponding quarter. The 3rd quarter was the quiet months after the completion of the overseas incentive trip promotion campaign and 25th year anniversary grand sales promotion in the 2 nd quarter of current financial year. As opposed to the preceding year’s corresponding quarter, revenue was recorded higher mainly due to higher contribution from incentive trip campaign which was ended in the 3rd quarter of the preceding year. The pre-tax profit was reduced by 15.2% to RM 14.5 million mainly due to lower revenue recorded and higher marketing costs incurred for the 25th year anniversary grand sales promotion.
Wholesale division revenue increase 20% due to higher sales generated from Chinese medicated tonic and Chinese tea(during chinese new year festival).Pretax profit increase double due to gain from resale of treasury sales amounting to approximately RM 2.0 million. If this 1 time gain reduce from net profit RM19 mil,the actual net profit should be RM16mil to RM17mil, pls take note.
i question we need to ask,for the coming quarter (Feb to Apr 2018),due to no festival within this period & may be no promotion like last year & GE wil be take place within this quarter.will consumption maintain as previous year.
what i concern is revenue drop for the continues 2 quarter,wil this trend continue for the coming quarter.
Kenange Call Target price RM6.00, what is the basis ? unless revenue & net profit keep on increase for the coming quarter.
Base on EPS 20.16 cent, PE = 23 . I prefer maintain TP RM5.00.
Wholesale division The revenue from external sales increased by RM 2.9 million or 20.1% to RM 17.1 million as compared to the preceding year’s corresponding quarter of RM 14.2 million. The increase in revenue was mainly contributed by higher sales generated from Chinese medicated tonic and Chinese tea. The pre-tax profit increased by more than double to RM 8.9 million mainly generated from its premium Chinese medicate tonic and sales of vintage Puer tea. Furthermore, gain from resale of treasury sales amounting to approximately RM 2.0 million and higher contribution from inter-segment sales had further contributed to the increase in the pre-tax profit.
Administration cost(RM6.62mil) & selling & distribution cost (RM13.58mil) keep on increase when revenue keep on droping.
current liability maintain at a very healthy position. (liability drop from 107mil to 83mil).good job,salute again to Tauke Tan & his management team. & thanks for your 3 cents dividend,cheers.
Again i suggest TP for end of the year RM5.00 base on PE 25.
the recently launched lifestyle products such as shoes, handbags will certainly benefit HaiO for the coming quarters, It is designed by well known designer Jimmy Choo.
Hai-O Enterprise Bhd - Higher Earnings Momentum Envisaged
We came away feeling optimistic on HAIO’s prospect after a company visit. We expect MLM division to gain momentum on shoes and leather goods designed by Jimmy Choo which are set to boost high-margin products composition and HAIO’s overall profitability. We keep our FY18E/FY19E NP unchanged pending full pricing details, but, we raised our TP from RM5.60 to RM6.00 based on higher 17x FY19E EPS (+1.0 SD above 5- year forward historical mean) to reflect the potential boost in earnings. Upgrade from MARKET PERFORM to OUTPERFORM.
Shoes and leather goods designed by Jimmy Choo to boost MLM highmargin products composition. HAIO has recently launched high-margin products designed by Prof. Datuk Dr Choo Yeang Keat (popularly known as “Jimmy Choo”) for its lines of “Infinence” products under foot wear/insole and leather goods. Note that, Jimmy Choo is the “Infinence” brand’s fashion consultant, and will be involved in the design of shoes, bags, attires and accessories (he recently retired as non-independent and non-executive director and afterwards, taken position as HAIO consultant). All in, these highmargin products are set to contribute more than 10% of the MLM revenue for the 2H18 (from <5% in 1H18) and are set to boost its MLM margin further (currently MLM EBIT margin at c.20%). With its strong 160,000 distributors (as of October 2017) and over 90% of its distributors are women, we reckon that HAIO should see stronger sales momentum and better profitability driven by these high-margin women products under its stable. As for the incentives campaign, the group start the year 2018 with a Europe tour trip to Switzerland and Paris (Jan-May 2018) and subsequently will launch two Asian tours for the remainder of the year (allocated capex of RM10m/year). For this year, the group is targeting more than 1,000 qualifiers for each tour (from previous high of c.800 qualifiers), which we estimated at c.RM185m in sales value per promotion period.
Better prospects for its wholesale and retail segments. Although both divisions (c.20% of revenue) are vulnerable to currency risk, HAIO’s focus on high margin in-house brands (c.40% for retail sales) has proven to bear fruits which produced higher-than-expected EBIT in its 1H18 results (>100% growth rate to RM9.6m and registered 33% EBIT margin) and the group expect the momentum to continue with the support of 140,000 card members in its retail segment. HAIO has added one more exclusive dealership under its retail segment recently and coupled with its existing Traditional Chinese Medicines (TCMs) line-ups, this is expected to boost earnings much further ahead and suppress any weakness in forex. (Please refer to the following page for the segments overview).
Outlook. We expect MLM earnings to gain further momentum with shoes and leather goods designed by Jimmy Choo which are set to boost highmargin products composition and supported by HAIO’s 26th year anniversary grand sales promotion in 2018 as well as higher contribution from the newly launched fashion and beauty care range of products under the “Infinence” brand. Moving forward, the MLM division will continue to expand its lifestyle segment of which margins are better compared to F&B products. On the other hand, wholesale and retail segments are expected to maintain its high EBIT margin with the in-house brands while mitigating forex weakness.
Upgrade to OUTPERFORM with a higher target price of RM6.00 based on 17x FY19E EPS implying +1.0SD above 5-year forward historical mean (previously from TP of RM5.60 based on 16x FY19E EPS, which was the +1.0SD-level back then). We believe our target PER of 17x is justifiable considering HAIO’s average 32% net profit growth per annum over the next two years. We like HAIO for its; (i) double-digit growth in distributors base (currently at c.160k), (ii) net profit growth averaging at 31% per annum over the next two years boosted by double-digit margin, and (iii) strong earnings support from high-margin products under its MLM and its leading Chinese medicine retail shops (under its other business). Risks to our call include: (i) lower-thanexpected sales, and (ii) higher-than-expected operating expenses.
Althought overall net profit increase RM4 mil compare previous year quarter,but revenue & net profit for MLM decrease 4.9% & 15% respectively.pls take note.
Administration cost(RM6.62mil) & selling & distribution cost (RM13.58mil) keep on increase when revenue keep on droping.
Wholesale division revenue increase 20% due to higher sales generated from Chinese medicated tonic and Chinese tea(during chinese new year festival).Pretax profit increase double due to gain from resale of treasury sales amounting to approximately RM 2.0 million. If this 1 time gain reduce from net profit RM19 mil,the actual net profit should be RM16mil to RM17mil, pls take note.
i question we need to ask,for the coming quarter (Feb to Apr 2018),due to no festival within this period & may be no promotion like last year & GE wil be take place within this quarter.will consumption maintain as previous year.
what i concern is revenue drop for the continues 2 quarter,wil this trend continue for the coming quarter.
Kenange Call Target price RM6.00, what is the basis ? unless revenue & net profit keep on increase for the coming quarter.
Base on EPS 20.16 cent, PE = 23 . I prefer maintain TP RM5.00 until end of the year .
u all see, last time EveryoneCanTrade F hAIO and ask for more DIV, then this queater HAIO really give special DIV, now U all realize the pOWER of F HAIO and CB HEE
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
SCK82
234 posts
Posted by SCK82 > 2018-03-20 12:11 | Report Abuse
we need to together curse AH Hee and His Family. He is liar.