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Oooh La La… Osim Achieves Record Profit

osim outletAsia’s No. 1 brand in well being and healthy lifestyle products, OSIM (SGX: O23), proudly announced that it had achieved 5 years of record profit and 20 straight quarters of profit growth when it made public its full year of 2013 (FY 2013) and fourth quarter of 2013 (4Q 2013) results.

Revenue for FY2013 improved 8% year-on-year to S$648 million while the net profit went up 17% to S$102 million. This translates to a net profit margin of 15.7% while that in the previous year was 14.4%. Diluted earnings per share (EPS) for the year came up to 13.58 cents while that in FY2012 was at 11.59.

The rise in revenue was due to higher consumer demand for OSIM products such as uInfinity, uDivine App, uAngel and nutritional supplements like Taut, Stem C, and Liver Protector. TWG Tea, which became a subsidiary of OSIM in October last year, contributed to part of the sales as well. In January this year, TWG Tea was 70% owned by OSIM, after the staked was upped. TWG Tea, often touted as the LVMH of tea, has 26 outlets currently, with about 20 more outlets targeted to be opened this year.

OSIM, which has 600 outlets in 31 countries, saw 54% of FY2013’s revenue come from North Asia, 39% from South Asia and the rest from America/Africa/Europe/ Middle East/Oceania.

For 4Q 2013, revenue rose 16% to S$179 million while the net profit surged 22% to S$28 million.

As of 31st December 2013, the firm had around S$267 million in cash and cash equivalents and its total debt stood at S$155 million, translating to a net cash position of $113 million. The return on equity for FY2013 was at 30%.

For FY2013, it generated S$105 million of cash flow from operations, while capital expenditure stood at S$12 million. This translates to a free cash flow of S$93 million. In the previous year, free cash flow was S$82 million. OSIM has been generating copious amounts of free cash flow over the years, affording it to pay consistent dividends.

For the quarter, a final dividend of 2 cents per share will be paid out. Including the interim dividends of 4 cents per share, the total dividends paid out for FY2013 works out to 6 cents per share. The same amount of dividends were paid out in FY2012 as well.

With new product pipeline, Osim expects its businesses to remain strong in 2014.

The shares last closed at S$2.39 on Monday. The historical PE ratio is at 17.6, based on the diluted EPS of 13.58 while the dividend yield is at 2.5%, based on the total dividends of 6 cents per share.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.  Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.