BLACKMORES says it remains bullish about future growth, despite a 43% drop in net profit after tax and a 6.7% sales decline for the nine months to 31 March.
CEO Christine Holgate released the third quarter results yesterday, saying "The sales trend is encouraging, particularly as we finished the third quarter slightly ahead of our second quarter result despite having fewer trading days".
"Our profit result for the first nine months was impacted by lower sales in Australia for Blackmores which was compounded by the higher cost of operating in those channels," Holgate said.
"We are focused on simplifying and streamlining our business, conservatively managing expenses and investing in our brand, facilities and new markets to diversify our revenues and underpin growth."
The combined Australian and New Zealand operations achieved sales of $264m for the nine months, and while Australian sales have steadily grown over each quarter of the year, this has still not been enough to make up for the decline in sales through retailers selling to consumers in China.
Chinese consumers are now buying through multiple channels with Blackmores in-country and export sales increased to $92m over the period, up 60% from the prior year, making ongoing adaption to meet China's regulatory controls an important part of managing the future, she added.
The Bioceuticals Group, including Global Therapeutics, increased sales $76m for the first nine months, up 53% compared to the previous corresponding period with "all brands delivering strong sales".
Holgate said continued consumer demand across all core markets as well as emerging demand in Asia and the strong performance of the practitioner business gave the company confidence in medium-term growth opportunities.
"The Board expects the full year profit will represent good growth on the 2015 financial year, recognising that 2016 was an exceptional performance that we will not match...we remain confident in the Group's strategic focus and growth prospects."
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