Full Year Result: Net Profit up 83%
Sydney, Aug 26, 2015 AEST (ABN Newswire) - Blackmores Limited (
ASX:BKL) has announced annual sales of $471.6 million, up 36% compared to the prior corresponding period, delivering a record net profit of $46.6 million for the full year, 83% up compared to the prior corresponding period.
HIGHLIGHTS
- Group Sales of $471.6 million, up 36% on the previous year
- Record net profit after tax of $46.6 million, up 83% on the previous year
- Strong operational cash flows supported net debt down 87% to $7.1 million
- Earnings per share of 270.7cents, up 81.4%
- Final dividend of 135 cents per share, total ordinary dividends for the year were 203 cents per share (fully franked), a 60% increase over last year's dividends
"We are particularly proud that our growth has come from all regions and brands," said Blackmores Chief Executive Officer Christine Holgate. "The higher sales were the culmination of a number of programs we had put in place over recent years including reinvigorating our Australian business, establishing an enterprise in China, investing in our quality and research programs and identifying a strong brand proposition that is supported by a higher level of marketing across the Group."
"Twelve months ago we were reporting pleasing momentum which continued to build as the year progressed. The benefits were further bolstered by operational efficiencies and improvements to the Group's cost base, by leveraging our increased volumes and optimising our Warriewood Campus facility," said Christine Holgate.
"These unprecedented levels of growth, including a 50% sales uplift in the second half, have created supply challenges. Our principal concern has been addressing the needs of our Australian consumers who have loyally supported the Blackmores brand for so many years. We have increased our supply and capacity significantly, whilst remaining focused on maintaining our unrivalled quality and commitment to efficacy and sustainability," she said.
BLACKMORES AUSTRALIA / NEW ZEALAND
Less than two years ago, Blackmores shared its strategic objective to grow the core Australian business profitably. As a result Blackmores Australia grew its profitability by 88% compared to the prior corresponding period, with sales in Australia up 43% to $317.4 million. This was achieved with double digit growth across all sales channels including community pharmacy, and appears to have been boosted by increased demand from Chinese tourists and entrepreneurs.
"We worked to deepen our relationships with retailers and to support consumer pull-through with increased investment in integrated brand activity, more merchandising units and extending our education program," said Christine Holgate. "Blackmores was recently recognised as the Most Trusted Brand in the category for the seventh consecutive year."
The profitability of Blackmores' Australian business has benefited from leveraging the scale of the growing Group as well as improved recoveries from the Warriewood Campus.
Blackmores New Zealand achieved sales growth of 13%, the strongest result since Blackmores has been in the New Zealand market.
BLACKMORES ASIA
Asia is a key region for Blackmores, providing an important platform to secure long-term profitable growth. This growth enables the Group to better leverage capital investments and provides sources of alternative currency that are intended to provide a natural hedge against the cost of raw materials that are sourced from all over the world.
Asia sales were up 26% for the year to $84.0 million, which is double that of five years ago. Earnings before interest and taxes (EBIT) from Asia were up 82% to $8.3 million.
Blackmores Malaysia sales were up 13.5% and EBIT was up 22% to $3.3 million. Thailand continued to be impacted by a soft market with sales down 7% and EBIT down 27%. However, Thailand remains highly profitable, contributing $6.3 million to Group earnings.
"Whilst challenges remain, we have strong local leadership and an experienced team and are optimistic about our future prospects," said Christine Holgate.
Blackmores' smaller markets in the region, Korea, Singapore and Hong Kong have all delivered strong sales results, they have significantly improved profitability and are growing.
Sales to China have multiplied, supported by the Blackmores Wholly Foreign-Owned Enterprise (WFOE) established in 2014. The opening of free trade zones created a substantial opportunity, especially as Blackmores was one of only a few companies in this category to secure a licence to directly trade within the zone.
"As noted, it is apparent that there are a growing number of Chinese shoppers and entrepreneurs purchasing our products through Australian retailers," said Christine Holgate. "By combining the contribution from these consumers with our Asia-based revenues, the value of the region to our Group sales is approximately $150 million for the year. This demonstrates the growing demand for our brand outside Australia and highlights the importance of our Asia growth strategy."
BIOCEUTICALS
BioCeuticals achieved an 18% increase in sales, compared to prior corresponding period, delivering $55.5 million and EBIT of $8.7 million, up 27%.
"When Blackmores acquired this company in 2012, we had expected to reach this target by 2017. This performance validates the strong fit for this company in our Group and is the result of a successful pipeline of innovative new products and a talented team," said Christine Holgate.
"Three years ago shareholders supported our decision to acquire this business which was fully debt funded. I'm pleased to report that every cent borrowed for this has now been repaid. The BioCeuticals team has not only grown its top line, it has made an impressive contribution to our Group earnings and our reputation with practitioners," she said.
For the full results, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-BKL-874591.pdf
To listen to CEO Christine Holgate, please visit:
http://www.abnnewswire.net/press/en/80756/blackmores
About Blackmores Limited
Blackmores Limited (ASX:BKL) (OTCMKTS:BLMMF) is Australia's leading natural health brand. Its quality range of vitamin, minerals, herbal and nutritional supplements, and continued support of the community and environment, are among the many reasons Blackmores is the most trusted name in natural health.
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