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Weak outlook hits profitable Blackmores

Simone Ziaziaris  |  22 Feb 2018Text size  Decrease  Increase  |  
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SYDNEY - [AAP] Blackmores (ASX: BKL) shares have plunged in early trade despite the vitamin maker boosting first-half profit by 20 per cent, with investors reacting to a warning of a soft second half due to supply issues and a weaker Australian market.

Blackmores has lifted its dividend after reporting profit of $34.2 million in the six months to December 31 and a nine per cent lift in revenue to $287.4 million.

Revenue in Australia and New Zealand of $121 million was slightly lower compared to a year ago as the broader consumer market remained subdued, Blackmores said.

But China sales grew 27 per cent with revenue of $73.9 million compared to $58.1 million a year ago as online promotion events delivered record sales.

However, Blackmores shares were down 16 per cent to $134.00 by 1015 AEDT as the company also warned "supply issues" and a soft Australian retail market would impact the second half.

"Though we remain confident we will continue to deliver good profit growth for the full year," Blackmores said in a statement.

The company also flagged a $2.8 million increase in its provision for doubtful debts in China.

Blackmores' other businesses in Asia, including Malaysia, Singapore, Hong Kong and Korea, also delivered strong sales growth in the first half with the division's revenue up to $39.4 million, from $33.4 million in the previous corresponding year.

The BioCeuticals division delivered sales growth of 11 per cent.

Blackmores declared a fully franked interim dividend of $1.50, up from $1.30 in the prior corresponding period when half-year profit plummeted 41 per cent due to a slump in Australian sales.

CHINA SALES GIVE BLACKMORES A BOOST:

* Net profit up 20pc to $34.2m

* Revenue up 9pc to $287.3m

* Fully franked interim dividend up 20 cents to $1.50

 

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is an AAP journalist.

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© 2021 Australian Associated Press Pty Limited (AAP) or its Licensors. This is the Morningstar service with content provided by AAP where indicated. AAP reserves all rights, including copyright, in services provided by it. The information in the service is for personal use only, does not constitute financial product advice (whether general or personal) and may not be re-written, copied, re-sold or re-distributed, framed, linked or otherwise used whether for compensation of any kind or not, without the prior written permission of AAP. You should seek advice from a professional financial adviser before making decision to acquire or dispose of a financial product.

This service is published for general information purposes only without assuming a duty of care. AAP is not in the business of providing financial product advice (whether personal or general advice), and gives no warranty, guarantee or other representation about the accuracy of the information or images contained in this service. AAP is not liable for errors, omissions in, delays or interruptions to or cessation of the services through negligence or otherwise. The globe symbol and "AAP" are registered trademarks.

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