Vitasoy sinks into the red, scraps payout

Vitasoy International Holdings (0345) swung to a net loss of HK$159 million for the year ended March mainly due to weaker sales in the mainland and scrapped paying the dividend for the whole year, the first time in more than 20 years

The loss compared with a net profit of HK$548 million in the previous year.

Total revenue decreased 14 percent to HK$6.5 billion due to the pandemic and the supply chain.

The group contacted different suppliers to carry out projects in an attempt to reduce costs including signing contracts to lock the price of raw materials, said Ng Ian-hong, group chief financial officer.

However, cost controls alone could not help maintain profitability amid rising logistics costs, she said.

Over the past six months, the group has raised prices in some markets, said Ng.

The company will continue to review market conditions and the prices of individual products at an appropriate time in this fiscal year, she added.

Vitasoy is willing to share profits with shareholders, but it needs to balance the interests of the company's long-term development with the proportion of dividends, said executive chairman Winston Lo Yau-lai.

The board of directors will pay attention to and review development prospects, Lo said, adding that the company may resume appropriate dividend payouts as the business returns to health and expected profits are achieved.

Revenue in the mainland market sank 23 percent to HK$3.84 billion in 2022 from HK$ 5.01 billion the previous year due to the Covid outbreaks.

Vitasoy's shares dropped 6.84 percent to close at HK$13.9 yesterday.