By Mikhail Raj Abdullah
KUALA LUMPUR, June 15 (Bernama) - Pu-Er tea was a star-performing product for Hai-O Enterprise Bhd as the group doubled its pre-tax profit to RM30.608 million for the financial year ended April 30, 2007, from RM15.126 million a year earlier.
Revenue rose 28.98 percent to RM189.346 million from RM146.798 million previously, which group managing director Tan Kai Hee attributed largely to tea sales, coupled with aggressive promotions by its multilevel marketing division.
Regarded as a wonder tonic with numerous health benefits ranging from removing toxins to improving blood circulation, Pu-Er tea contributed RM10 million in sales for financial year 2007.
Tan told Bernama in an interview here today that Pu-Er tea is the only tea with an investment value as its flavour improves with time just like wine and is a star tea product in China.
For the fourth quarter ended April 30, 2007, Hai-O turned in a pre-tax profit of RM10.187 million against RM2.856 million in the same quarter in 2006, while revenue rose 63 percent to RM56.72 million from RM34.89 million.
Looking ahead, Tan said: "We are debt-free and cash-rich and it's all systems go for us to be transferred to the Main Board in two to three months' time once all the procedures are completed."
The group is mainly involved in the wholesaling and retailing of traditional Chinese medicine, wine and tea products.
Tan said Hai-O, which also operates modern Chinese traditional clinics, would be able to expand faster when listed on the Main Board.
Established in 1975, Hai-O, which has become a household name offering a wide range of Chinese medicine and healthcare products, was listed on the Second Board in 1975.
Tan also said that the strengthening of the ringgit against the US dollar had reduced import purchase costs, thus improving the group's profit margins.
Looking head, he said Hai-O would continue to benefit from the current buoyant economy with the expected improvement in domestic consumption and trading activities.
Together with the company's continuous brand-building campaign, new product launches, marketing promotions and distributors' sale incentives programme, Tan said Hai-O is optimistic of continuing to remain profitable for the next financial year.