Vitasoy International (0345) H2 2024 earnings summary

Executive summary

• Operating profit increased 79% year-over-year to HK$185M, and profit attributable to shareholders rose 155% to HK$116M for FY2023/24.

• Group revenue grew 1% net of currency and COVID subsidies, reversing a 3% decline in the first half, though down 2% in HKD terms due to currency depreciation.

• Mainland China delivered strong second-half results, with revenue up 10% in RMB and operating profit up over 400% year-over-year.

• Hong Kong operation maintained single-digit growth, with operating profit up 42% (excluding subsidies/currency), while Australia & New Zealand faced revenue and profit declines due to manufacturing and logistics issues.

• EBITDA increased to HK$685M, up 27% by one measure and 10% by another, with margin rising to 11%.

Financial highlights

• FY2023/24 revenue: HK$6,217M, up 1% net of currency and subsidies; gross profit: HK$3,111M, up 7%.

• Gross profit margin improved to 50%, up from 48% year-over-year.

• Basic EPS rose 153% to HK10.9 cents.

• Cash position at HK$794M and net cash balance of HK$111M as of March 2024; bank borrowings reduced to HK$256M.

• Capital expenditure reduced to HK$133M after prior year production line upgrade.

Outlook and guidance

• Confident in continued revenue and profit growth at both Mainland China and Group level.

• Mainland China to focus on core assets and innovation; Hong Kong to sustain growth via portfolio innovation.

• Australia aims to resolve manufacturing issues and improve profitability; ASEAN to drive topline and bottom-line growth; Singapore to return to profit.

• Ongoing commitment to sustainability targets in portfolio and energy.

• Continued investment in the Philippines joint venture to grow market share.