Chlitina Holding Ltd (麗豐), a China-based beauty product manufacturer, on Thursday said that it would focus on royalty income from its direct-sales subsidiary, as well as the development of e-commerce this year.
While the company has continued to consolidate its brick-and-mortar channels and gradually implemented a store management system to enhance its franchise management, it also wants to pay equal attention to its wholly owned direct-sales unit, Kelti China (克緹中國), and its newly installed Beauty Health Happiness (新美力) e-commerce platform.
The company’s pledges come as it reported stronger-than-expected profit for last year, with net profit rising from NT$755.84 million in 2014 to NT$1.17 billion last year (US$23.07 million to US$35.71 million). Earnings per share were NT$14.68 last year, compared with NT$9.51 a year earlier.
“We saw our growth last year mainly derived from China operations,” the company told investors at a earnings conference organized by the Taiwan Stock Exchange in Taipei on Thursday.
Chlitina began its business in Taiwan in 1989 and tapped into the Chinese market in 1997. It now has more than 200 in Taiwan and more than 3,400 stores in China.
Apart from contributions from its brick-and-mortar distribution channels, Chlitina also counted on Kelti China and e-commerce business to drive its revenue to grow 43.07 percent year-on-year to NT$4.39 billion last year.
Chlitina obtains royalty income from Kelti China by authorizing relevant trademark rights for 3DR and Peekaboo beauty-care brands. The company said it receives 6 percent of Kelti China’s sales in royalty fees if its subsidiary’s monthly revenue derived from authorized cosmetics and skincare products exceeds 10 million yuan (US$1.5 million).
As Kelti China’s revenue jumped by 525 percent annually to 4 billion yuan last year, the Chinese subsidiary has become the 10th largest direct-sales distributor in China and an emerging revenue contributor to its parent company.
The company in July last year launched the Beauty Health Happiness platform and introduced online-to-offline service to help integrate its virtual channels with brick-and-mortar stores.
Chlitina said this year it plans to make inroads into other platforms, roll out apps and construct an online shopping mall in a bid to enhance consumer experience with a wider product range.
“The contribution of e-commerce sales is still low, but we see great potential going forward,” Yuanta Securities Investment Consulting Co (元大投顧) said in a note on March 9.
China’s economic growth slowed to 6.9 percent last year, the country’s slowest expansion in a quarter of a century, but the country’s growing income per capita and an expanding middle-class are expected to continue benefiting the cosmetics and personal care industry, Capital Securities Corp (群益證券) said in a note on March 15.
Against this backdrop, Chlitina is forecast to see revenue increase 12.5 percent to NT$4.94 billion this year, with earnings per share predicted to reach NT$18.32, Capital Securities said.
Yuanta predicted Chlitina’s sales would grow 17 percent to NT$5.15 billion this year, but lowered its earnings forecast to NT$17.15 citing the firm’s higher operating expense driven by increased marketing activities and the costs of constructing a new management system.
Chlitina has proposed to distribute a cash dividend of NT$10 to shareholders this year, which represents a payout ratio of 68.1 percent.
The planned dividend payout also translates into a dividend yield of 3.78 percent based on the firm’s share price of NT$264.5 at the close of Taipei trading on Friday.
Additional reporting by Kevin Chen
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said that its investment plan in Arizona is going according to schedule, following a local media report claiming that the company is planning to break ground on its third wafer fab in the US in June. In a statement, TSMC said it does not comment on market speculation, but that its investments in Arizona are proceeding well. TSMC is investing more than US$65 billion in Arizona to build three advanced wafer fabs. The first one has started production using the 4-nanometer (nm) process, while the second one would start mass production using the
A TAIWAN DEAL: TSMC is in early talks to fully operate Intel’s US semiconductor factories in a deal first raised by Trump officials, but Intel’s interest is uncertain Broadcom Inc has had informal talks with its advisers about making a bid for Intel Corp’s chip-design and marketing business, the Wall Street Journal reported, citing people familiar with the matter. Nothing has been submitted to Intel and Broadcom could decide not to pursue a deal, according to the Journal. Bloomberg News earlier reported that Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is in early talks for a controlling stake in Intel’s factories at the request of officials at US President Donald Trump’s administration, as the president looks to boost US manufacturing and maintain the country’s leadership in critical technologies. Trump officials raised the
‘SILVER LINING’: Although the news caused TSMC to fall on the local market, an analyst said that as tariffs are not set to go into effect until April, there is still time for negotiations US President Donald Trump on Tuesday said that he would likely impose tariffs on semiconductor, automobile and pharmaceutical imports of about 25 percent, with an announcement coming as soon as April 2 in a move that would represent a dramatic widening of the US leader’s trade war. “I probably will tell you that on April 2, but it’ll be in the neighborhood of 25 percent,” Trump told reporters at his Mar-a-Lago club when asked about his plan for auto tariffs. Asked about similar levies on pharmaceutical drugs and semiconductors, the president said that “it’ll be 25 percent and higher, and it’ll
CHIP BOOM: Revenue for the semiconductor industry is set to reach US$1 trillion by 2032, opening up opportunities for the chip pacakging and testing company, it said ASE Technology Holding Co (日月光投控), the world’s largest provider of outsourced semiconductor assembly and test (OSAT) services, yesterday launched a new advanced manufacturing facility in Penang, Malaysia, aiming to meet growing demand for emerging technologies such as generative artificial intelligence (AI) applications. The US$300 million facility is a critical step in expanding ASE’s global footprint, offering an alternative for customers from the US, Europe, Japan, South Korea and China to assemble and test chips outside of Taiwan amid efforts to diversify supply chains. The plant, the company’s fifth in Malaysia, is part of a strategic expansion plan that would more than triple
RSS