Vitasoy announces business results for the first half of the 2022/2023 financial year

Financial highlights

6 months to end

30th Sep 2022

1H FY2022/23

million HK$

1H FY2021/22

million HK$

change

Minus FX influence

revenue

3,642

3,604

+1%

+4%

gross profit

1,738

1,727

+1%

+4%

EBITDA

473

320

+48%

+50%

profit before taxes

175

34

+421%

+382%

Profit attributable to shareholders of the company

142

33

+332%

+291%

Earnings per share (HK cents)

13.3

3.1

+329%

+292%

Interim dividend per share (HK cents)

1.3

zero

N / A

N / A

HONG KONG, November 18, 2022 /PRNewswire/ — Vitasoy International Holdings Limited (“Vitasoy” or the “Company”, together with its subsidiaries, the “Group”, SEHK code: 00345) today announced its interim results as at December 30, 2008thSep 2022 (“the period”).

During the six months of the reporting period, the Group reported sales growth on a local currency basis in most markets and reported total sales of HK$3,642 million (FY 2021/2022 meanwhile: HK$3,604 million). The group focused on fundamentals to ensure sustainable and profitable revenue growth. The Group’s gross profit for the interim period was HK$1,738 million (FY 2021/2022 meanwhile: HK$1,727 million), mainly due to higher sales performance. Gross margin maintained at 48%. Operating profit rose sharply by nearly 400%, mainly due to strong performance in Mainland China, rephasing of advertising and promotional spending, further government subsidies from Hong Kong SAR and lower operating expenses.

Mister. Winston Yau-lai Lo, Executive Chairman of Vitasoy International Holdings Limited, said at a press conference today: “While we are encouraged by the Group’s significant progress in meeting growth and profitability targets, we still have much work to do on the long-term growth trajectory . Nevertheless, barring unforeseen macroeconomic changes in the environment, we are confident that our disciplined focus on fundamentals will enable us to not only sustain, but incrementally improve, our top-line and bottom-line performance over the coming years.”

Based on the Group’s improved financial results, the Board recommends an interim dividend of 1.3 HK cents per common share for the six months to the end September 30, 2022 (Six months ends 09/30/2021: zero).

Mainland China

Profit growth driven by solid core business performance and innovation

Vitasoy’s operations in mainland China recorded sales growth of 4% in local currency 1,916 million RMBwith strong operating profit growth HK$139 million due to scale acceleration and strict control of operating costs.

Meanwhile, the organizational structure and managerial skills of operations in mainland China were further strengthened, providing impetus for the implementation of the group’s strategy of gradually accelerating beyond the company’s three growth vectors: execution (same-business revenue growth), expansion and innovation . Sales of both VITASOY and VITA products grew, as did sales in most provinces and distribution channels.

VITASOY remained the leader in soy milk, while VITAOAT Oat Milk, launched last year, continued to gain scale, generated additional revenue and increased brand awareness among plant-based, exercise-conscious shoppers. The core premium lemon portfolio continued to be the main driver for VITA and the new fruit and sparkling teas were well received by consumers

For the remainder of the 2022/2023 financial year, the company will continue to launch advertising and promotional campaigns and execute its strategy across all growth vectors. Vitasoy will also explore opportunities to save on operating costs and contain rising material and energy costs while adjusting prices to maintain profitability.

Hong Kong operation – (Hong Kong SAR, Macao SAR and Exports) –

Steady growth driven by the strength of our core business and successful products innovation

The Hong Kong operation achieved steady growth with sales growth of 6% despite weak consumer sentiment and travel restrictions, thanks to the strength of Vitasoy’s core business and successful product innovation. Market share increased in both the soy and tea categories, while new pricing and value creation projects helped protect margins and contain costs. The group’s Vital and Tuckshop and Catering businesses saw improved performance thanks to increases in school days and quarantine hotel business.

In the non-alcoholic beverage wholesale segment, strong brand value and effective sales execution confirmed the Group’s leading position in the local market. Vitasoy also increased market share in both the ready-to-drink tea and soy/vegetable milk beverage categories, with additional growth driven by new product launches. All new products received encouraging buyer feedback.

Operating income increased 17% compared to the same period last year 145 million Hong Kong dollars. Excluding government subsidies related to COVID-19, operating profit fell 25%, mainly due to increases in raw material and fuel costs.

The group will continue to drive core business and launch new products while optimizing costs and exploring potential business opportunities across channels.

Australia and New Zealand

Sustainable growth driven by capitalizing on growing interest in oat milk

Vitasoy’s operation in Australia and New Zealand continued strong performance on a local currency basis despite significant economic headwinds and inflationary cost pressures. Sales increased 8% in local currency by successfully capitalizing on growing consumer interest in oat milk.

Consistent results were also achieved with other plant milk platforms. Sales of the VITASOY brand grew across all major plant milk platforms with soy, almond and oats. The oats category is particularly well received Australia, where VITASOY has become number one in the oat and soy categories. The weaker development on the coffee market was more than compensated for by innovative products such as the new VITASOY Greek Style soy yoghurt range, which has met with an encouraging initial response in the market. During the period, operating income declined due to higher raw material costs caused by global supply chain shifts, resulting in higher logistic and overhead costs.

With strong demand for VITASOY products in Australia and New ZealandVitasoy will continue to scale up in the most important plant milk categories and at the same time work intensively to successfully establish VITASOY’s new plant-based yoghurt in these markets.

Singapore

Disappointing performance despite growth of the new VITASOY Fresh Plant+ plant milk

The performance of the group Singapore experienced a setback given the increased price competitiveness and commercialization of the tofu category, which could not be offset by the growth of our new plant milk platform Vitasoy Fresh Plant+. Sales shrank by 16% in local currency. Operating income declined due to below-average sales, higher soybean prices, ancillary and operating expenses, and higher advertising and promotional spend in support of VITASOY Plant+ plant-based milk and tofu.

The group will work in a disciplined manner to improve execution and contain costs in their business Singapore to ensure price and product competitiveness while expanding its new VITASOY Plant+ plant milk line from Malaysia.

The Phillipines

The company’s joint venture with Universal Robina Corporation had a very strong half-year with double-digit sales increases, helped by local manufacturing that began as COVID-19 restrictions eased. VITASOY plant milk has now reached a market share of 14% in the plant milk category the philippines.

For the remainder of the 2022/2023 financial year, the group will continue to improve the visibility and availability of VITASOY in the core sales channels while strengthening the brand equity for future growth. Vitasoy will also build on the success of the new single-serve and multi-serve products launched in this market and advocate for future growth in all major plant milk segments of soy, almond and oat.

General Outlook

As Vitasoy’s business in Mainland China remains the largest market and also the main driver for the group’s expansion, the priority now is to maintain profitable growth and per capita consumption in Mainland China through better execution in the same businesses , a national expansion and innovations to build equity. The group is also optimistic about maintaining performance in its other markets as the plant-based sector continues to become mainstream.

Please refer to the following documents for more details.

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Vitasoy management presents its latest Fresh Vitasoy Plant+ launched in Hong Kong SAR at the press conference.  (From left) Mr. Roberto GUIDETTI, Group Chief Executive Officer;  Mr. Winston LO, Executive Chairman;  and Ms. Ian NG, Group Chief Financial Officer.

Vitasoy management presents its latest Fresh Vitasoy Plant+ launched in Hong Kong SAR at the press conference. (From left) Mr. Roberto GUIDETTI, Group Chief Executive Officer; Mr. Winston LO, Executive Chairman; and Ms. Ian NG, Group Chief Financial Officer.

Fresh Vitasoy Plant+ is launched in Hong Kong SAR.

Fresh Vitasoy Plant+ is launched in Hong Kong SAR.

About Vitasoy

Vitasoy International Holdings Limited is a leading manufacturer and distributor of plant-based foods and beverages. 1940 by the late Dr. Kwee-seong Lo in founded Hong Kong, China, the company strives to promote sustainable, plant-based nutrition by providing a variety of quality products, with nutrition, taste and sustainability guiding its portfolio offering. Vitasoy currently has offices in Chinaincluding Mainland China and Hong Kong Special Administrative Region, Australia, Singapore and the philippines. Its products are available in approximately 40 markets worldwide.

Vitasoy is listed on the Main Board of the Hong Kong Stock Exchange (00345.HK) and is a constituent of the Morgan Stanley Capital International (MSCI) Hong Kong Small Cap Index, the Hang Seng Stock Connect Hong Kong Index and the Dow Jones Sustainability Index (DJSI) – Asia Pacificamong other.

Vitasoy website: www.vitasoy.com

SOURCE Vitasoy International Holdings Limited

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