The Straits Times / The Business Times News on Best World

Best World's 2006 profit up 40.1%

By Christine Sim
Feb 15, 2007
The Business Times

BEST World International's 2006 full-year net profit has risen 40.1 per cent to $11.86 million, thanks to a 40 per cent jump in revenue to $77.11 million.

The net profit translates to a 30.7 per cent rise in earnings per share to 7.19 cents. Best World expects revenue and profit in 2007 to outperform those of 2006. The group expects its Hong Kong and Taiwan markets to grow to make up 5-10 per cent of total sales in 2007. There are also plans to penetrate the China market with a subsidiary in Hunan to begin operations this year.

The group also expects demand to increase as it has obtained a halal certification for health supplements. It expects to further penetrate the Muslim segment of its Malaysian and Indonesian markets.

Malaysia remained Best World's largest market, making up 42 per cent of revenue in 2006. Singapore is also a core mainstay market contributing 31.2 per cent. Indonesia, which brought in a revenue of $17.5 million, is expected to be one of the key drivers of growth in 2007 along with Thailand, Vietnam, Hong Kong and Taiwan.

Dora Hoan, group chief executive officer of Best World, said: 'We believe our rapidly expanding distribution network and implementation of our exclusive training system will provide us with a strong foundation to grow further.'

Profit was driven by growth in demand for existing products, successful product launches, and increasing membership base and the number of Lifestyle Centres. Best World sells health, skincare and lifestyle products through regional direct selling networks.

The area of the greatest growth was direct selling, accounting for 99.4 per cent of revenue, compared with 98.5 per cent previously. Direct selling achieved a revenue of $76.6 million, a 41.1 per cent increase. While membership base increased 45.5 per cent to 99,738 from 68,577 last year, retail and export sales fell 22.7 and 43.7 per cent respectively. The group has recommended a final tax-exempt dividend of 1.3 cents a share. Together with the interim dividend of 1.2 cents, this represents a payout of 34.8 per cent of 2006 net profit.