Due to low sales in Hong Kong.
Traditional Chinese medicine (TCM) provider Eu Yan Sang reported that its net profit crashed by a staggering 75% year-on-year to $494,000 in the second quarter, compared to $2 million in the same period last year.
The group's results were adversely impacted by slowing sales. Retail revenue in its key market of Hong Kong dropped 13% due to a decline in spending in mainland tourists. However, the strong Hong Kong Dollar helped to reduce Hong Kong’s revenue decline to 5% when translated to Singapore Dollars.
Meanwhile, revenue from Malaysia saw an increase of 14% due to stronger sales. However, as a result of the weakening of the Malaysian currency, the revenue from Malaysia, when translated into Singapore dollars, dropped by 8% year-on-year.
Revenue from Singapore rose 13% during the quarter on back of promotional campaigns and launch of new products.
In Australia, revenue surged by 18% in the last quarter as a result of an increase in the number of company-operated outlets and the rise in same-store sales. However, the appreciation of the Singapore Dollar against the Australian currency has resulted in only an 8% increment for Q2.
The group said that it remains cautious on its business outlook as the macro environment in Hong Kong and Malaysia is expected to be challenging.
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