EHS bullish on e-commerce earnings

By Ted Chen  /  Staff reporter

Wed, May 16, 2018 - Page 12

Eastern Home Shopping & Leisure Co Ltd (EHS, 東森購物) is optimistic on earnings growth this year as the TV shopping operator expands into the cross-border e-commerce business through an acquisition.

The company in January acquired a 76 percent stake in Hong Kong-based Strawberry Cosmetic Holdings Limited BVI for NT$1.06 billion (US$35.51 million), which operates, an online store carrying discount cosmetics, skincare and beauty brands in 230 nations.

EHS is expecting a boost to its profit and top line as its products are listed on Strawberrynet, Gary Wang (王令麟), chairman of Eastern Media Group (東森集團), the parent company of EHS, told a news conference in Taipei.

Strawberrynet already carries several notable Taiwanese cosmetics brands, he added.

“We expect our earnings per share to rise to NT$6 this year from NT$3.84 last year, with sales this year projected to rise 33 percent year-on-year to more than NT$18.3 billion,” Wang said.

EHS’ top line could expand to between NT$28 billion and NT$30 billion by 2020, and overseas sales could outpace contribution from the company’s home market in about three years’ time, Wang added.

Given the limited market at home, local companies must tap the global market, Wang said, adding that as opposed to building capabilities and warehouses on its own, the acquisition of operators is the quickest way to establish a foothold in the e-commerce market.

Wang also outlined plans to improve margins by raising the proportion of private-label and exclusive products in EHS’ product offerings from 16 percent last year to 25 percent this year, with a goal of 40 percent by the end of next year.

Eastern Media Group would support EHS and Strawberrynet through its online news outlet, Wang said, adding that the parent company also plans to establish a health supplement product development subsidiary to bolster its offerings.

Strawberrynet’s platform supports 38 languages and payments in 56 currencies, and carries 33,000 products by 830 brands, making it the ideal platform to enhance EHS’ access to the global market, Wang said.

Strawberrynet has average annual sales of about HK$1.1 billion (US$140.13 million), Wang said.

The company would refrain from engaging in unsustainable competition on prices and shipping fee subsidies in Taiwan’s fiercely competitive e-commerce market, Wang said.