KUALA LUMPUR: Hai-O Enterprise Bhd is expected to register double-digit growth in its earnings and turnover for the financial year ending April 30, 2008 (FY08), mainly driven by the higher contribution from its multi-level marketing (MLM) division, said managing director Tan Kai Hee.
For the first half of FY08, the company posted a net profit of RM16.2 million, up 90.6% from a year ago while revenue increased 72.1% to RM139.8 million.
Hai-O is expected to release its third-quarter results this month.
Its shareholders yesterday approved the proposed acquisition of 28 acres of land and a building in Kapar, Klang from Bata (Malaysia) Sdn Bhd for RM45 million cash, to be funded by internal funds of RM25 million and RM20 million bank borrowings.
Tan said 40% of the area will be leased to Bata for nine years, with the option to renew the contract, generating a recurring income of about RM2.5 million annually for Hai-O.
The remaining area will be used for setting up its own warehouses and factories, with details to be announced in the future, he said.
The acquisition was expected to be completed by end of April, he added.
Tan said the company had been distributing half of its earnings to shareholders for the past four years.
Hai-O announced a gross interim dividend of 8% for the first half of FY08 and plans to announce more dividends for the second half.
“Going forward, we intend to expand our MLM businesses. We plan to seek more China entrepreneurs to come to Malaysia and invest in the MLM business,” Tan said.