Hengan reports 2.6pc drop in profit to 1.37b yuan amid fierce price competition

Hygiene products maker Hengan International (1044) reported on Thursday that first-half net profit attributable to shareholders dropped 2.6 percent from a year earlier to 1.37 billion yuan (HK$1.49 billion), pressured by fierce price competition.

The impact was partly cushioned by higher tissue paper sales and increased market share, with revenue edging down only 0.2 percent to 11.81 billion yuan.

Hygiene business recorded a revenue decline of about 14.4 percent to 3.3 billion yuan, accounting for about 28 percent of the total, while tissue paper revenue rose over 3 percent to 7.17 billion yuan.

Online and new retail channels continued to expand, with their share of sales climbing to 34.4 percent in the first half from 31.8 percent a year earlier, driving a 7.9 percent revenue increase.

Hengan said it expects tissue paper sales to provide solid support for revenue in the second half, and overall sales are anticipated to remain stable under its strategies of omni-channel distribution, product personalization and stable pricing, according to an exchange filing.

STAFF REPORTER