TIGER Balm maker Haw Par Corp’s profit fell 5.5 per cent to S$106.3 million for the six months ended Dec 31, 2024, on the back of higher costs.
Nevertheless, it has proposed a special dividend of S$1 per share, along with a final dividend of 20 cents per share, set to be paid on May 21.
Haw Par’s revenue for the half-year grew 4.8 per cent to S$126.7 million, driven by higher sales from the healthcare segment, the company said in its earnings statement on Friday (Feb 21).
However, it also saw higher expenses – with cost of sales up 16.5 per cent and distribution and marketing expenses increasing by 17.4 per cent with healthcare product launches. Finance expenses also rose 21.3 per cent due to higher bank borrowings.
As a result, Haw Par’s gross margin shrunk to 55 per cent in H2, from 59.5 per cent in the corresponding period in the previous year.
Its new healthcare manufacturing plant in Malaysia – which started commercial production in the recent H2 – also affected the gross margin. This is due to “the effect of unallocated overheads as production volume gradually ramps up”, the company said.
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For the full year, Haw Par’s profit rose 5.4 per cent to S$228.3 million, on the back of a 5.5 per cent increase in revenue to S$244.8 million.
Its healthcare segment revenue grew 5.9 per cent to S$226 million, which Haw Par attributed to “rising consumer optimism in Asean markets and countries outside the continent”.
Revenue from its leisure and property divisions rose slightly, by 1.3 per cent, to S$18.8 million. This was due to improved occupancy at some of its investment properties in Singapore, albeit offset by lower visitor numbers and revenue at the Thai aquarium Underwater World Pattaya.
Looking ahead, Haw Par believes that its operating profits and margins “may face continued inflationary pressures and uncertain consumption recovery”, with additional risks from potential US tariffs and any countermeasures.
“Ongoing geopolitical tensions and fluctuating interest rates will also increase the volatility of the stock market and, in turn, impact the valuation of the group’s strategic investments,” it said.
Haw Par ended Friday at S$11.98, up 1.1 per cent or S$0.13.
