Dr. Wu Skincare Co Ltd (達爾膚生醫科技) yesterday issued a reserved outlook on earnings growth this year due to challenging macroeconomic conditions.
In light of weak growth in consumer spending, as well as the falling number of Chinese tourists, the company’s retail partners have turned bearish about placing stocking orders, which have dragged on growth momentum, Dr. Wu chairman and chief executive officer Eric Wu (吳奕叡) said at an investors’ conference in Taipei.
Going forward, the company is not expecting growth momentum to decelerate, Wu said, referring to last year’s results when the company posted 33 percent and 36.7 percent annual increases in sales and net income respectively.
Sales last month were also hit as the company swapped out poor-performing retail partners as part of plans to expand its sales channels, Wu said, adding that the situation would pass in the short-term as the new partners grow more familiar with its operations.
“Restocking orders from outgoing partners slowed as their contracts neared expiration,” Wu said, noting that sales last month fell 46.94 percent month-on-month to NT$50.17 million (US$1.67 million).
Similarly, a switch in retail partners also hampered sales growth at the company’s overseas operations in China, Malaysia and Singapore, Wu said.
The company reported that net income rose 1.3 percent year-on-year to NT$67.92 million in the first quarter, with sales gaining 10.2 percent to NT$257.98 million. Earnings per share were NT$1.48.
During the period, the company incurred foreign-exchange losses of NT$11.87 million due to the stronger New Taiwan dollar.
The company is aiming to maintain growth momentum this year by teaming up with leading brick-and-mortar chains in Taiwan and China, Wu said.
In Taiwan, where offline sales represented 60 percent of total sales last year, the firm’s products are to be featured at @cosme stores, a Japanese chain, Wu said.
In China, the company has secured agreements to feature its products at 50 Watson’s stores before the end of the first half of the year and 100 stores before the end of this year, Wu added.
Despite the downturn in sales, Wu said that the company has maintained its profitability while containing costs, with gross margin holding at 68.5 percent last quarter, up from 67.3 percent the previous year.
He said that although margins are lower in China due to higher marketing expenses for brand-building, the firm is expecting continued growth in sales.
Sales contribution has grown from 2 percent in 2014 to about 20 percent at the end of last year, he said.
The company plans to expand its digital marketing and social media promotions to maintain sales momentum in China, where revenue last year registered a 63 percent year-on-year increase to NT$226.43 million, he said.
GROWING OWINGS: While Luxembourg and China swapped the top three spots, the US continued to be the largest exposure for Taiwan for the 41st consecutive quarter The US remained the largest debtor nation to Taiwan’s banking sector for the 41st consecutive quarter at the end of September, after local banks’ exposure to the US market rose more than 2 percent from three months earlier, the central bank said. Exposure to the US increased to US$198.896 billion, up US$4.026 billion, or 2.07 percent, from US$194.87 billion in the previous quarter, data released by the central bank showed on Friday. Of the increase, about US$1.4 billion came from banks’ investments in securitized products and interbank loans in the US, while another US$2.6 billion stemmed from trust assets, including mutual funds,
AI TALENT: No financial details were released about the deal, in which top Groq executives, including its CEO, would join Nvidia to help advance the technology Nvidia Corp has agreed to a licensing deal with artificial intelligence (AI) start-up Groq, furthering its investments in companies connected to the AI boom and gaining the right to add a new type of technology to its products. The world’s largest publicly traded company has paid for the right to use Groq’s technology and is to integrate its chip design into future products. Some of the start-up’s executives are leaving to join Nvidia to help with that effort, the companies said. Groq would continue as an independent company with a new chief executive, it said on Wednesday in a post on its Web
Even as the US is embarked on a bitter rivalry with China over the deployment of artificial intelligence (AI), Chinese technology is quietly making inroads into the US market. Despite considerable geopolitical tensions, Chinese open-source AI models are winning over a growing number of programmers and companies in the US. These are different from the closed generative AI models that have become household names — ChatGPT-maker OpenAI or Google’s Gemini — whose inner workings are fiercely protected. In contrast, “open” models offered by many Chinese rivals, from Alibaba (阿里巴巴) to DeepSeek (深度求索), allow programmers to customize parts of the software to suit their
JOINT EFFORTS: MediaTek would partner with Denso to develop custom chips to support the car-part specialist company’s driver-assist systems in an expanding market MediaTek Inc (聯發科), the world’s largest mobile phone chip designer, yesterday said it is working closely with Japan’s Denso Corp to build a custom automotive system-on-chip (SoC) solution tailored for advanced driver-assistance systems and cockpit systems, adding another customer to its new application-specific IC (ASIC) business. This effort merges Denso’s automotive-grade safety expertise and deep vehicle integration with MediaTek’s technologies cultivated through the development of Media- Tek’s Dimensity AX, leveraging efficient, high-performance SoCs and artificial intelligence (AI) capabilities to offer a scalable, production-ready platform for next-generation driver assistance, the company said in a statement yesterday. “Through this collaboration, we are bringing two
RSS