Bursa Malaysia Main Market-listed Amway (Malaysia) Holdings Berhad announced its Q3FY18 revenue at RM260.2 million, representing 6.8 per cent growth vs. Q3FY17; and profit before tax at RM21.5 million, an increase of 10.5 per cent vs. Q3FY17.
This reflects the impacts from the Malaysian Financial Reporting Standard 15 (MFRS15), Revenue from Contracts with Customers, adopted with effect from 1 January, the Group adopted MFRS15 using the modified retrospective method where comparative figures were not restated.
Excluding the impacts arising from MFRS15, Q3FY18 revenue was RM267.6 million, 9.8 per cent higher vs. Q3FY17 (RM243.7million); and the Group’s profit before tax was RM22.2 million, an increase of 14.4 per cent vs. Q3FY17 (RM19.4 million) due to higher sales, favorable foreign exchange impact on cost of sales and lower operating expenses.
“The higher revenue for the quarter under review was due to stronger AMWAY Business Owners’ (ABOs’) momentum towards the conclusion of Performance Year (PY) 2018 in the current quarter, driven by the current year’s sale and marketing plan in addition to the timing difference of marketing promotion versus the same period last year,” said AMWAY Malaysia managing director, Mike Duong.
For the nine months ended 30 September, Group revenue was RM723.3 million, 1.3 per cent lower; and the Group’s profit before tax was RM42.8 million, 18.8 per cent lower than the same period last year.
Excluding the impacts arising from MFRS15, Group revenue was RM739.9 million, 1.0% per centhigher; and Group profit before tax was RM43.1 million, 18.2 per cent lower as compared to the same period last year due to higher import cost (primarily attributed to the weaker Ringgit) and increased ABO bonus and sales incentives in line with higher sales, partially offset by lower operating expenses.
In comparison to the 2QFY18, the Group’s revenue rose 14.2 per cent to RM260.2 million vs. RM227.8 million driven by strong ABO momentum and positive response towards sales/marketing plans during the conclusion of the ABO performance year 2018 and the start of the new performance year in September.
Profit before tax increase by 108.3 per cent to RM21.5 million compared to the preceding quarter’s RM10.3 million, this was mainly due to higher sales and lower operating expenses but was partially offset by higher ABO bonuses in line with higher sales.
Based on the strength of third quarter sales, the Board is optimistic that in comparison to last year, Group sales for the year will be flat given the array of product launches and major marketing promotions.
Additionally, the Group’s profit for the fourth quarter is expected to rebound from a challenging first nine months.
“Given the continued growth of new ABO sign up figures and strong line up of innovative new products, we believe our ABOs will be able to gear up their purchases well into 2019.
“Nevertheless, foreign exchange impact continues to exert pressure on our margins, to mitigate this, we will continue to proactively focus on strategies to effectively manage operating costs and implement various sales and marketing initiatives, as well as ABO experience-related infrastructure to support the ABOs’ businesses,” Mike added.
AMWAY Malaysia declared a third interim single-tier dividend of 5.0 sen net per share.
