Vision International People’s Group Public Co. (VIP) reported that group
turnover for the three months to 31 March, 2005, declined 23% y/y to USD 24 mln to USD 31.2 mln in the same period a year ago. The reduction had been anticipated and was mainly due to scheduled changes in the corporate distributor events calendar, which affected sales in the CIS & Baltics in this period. It is expected that the subsequent 2005 performance in these markets will outperform the sales performance in the comparative periods, VIP said in an official statement.
Sales in the CIS & Baltics markets for the three months to 31 March, 2005 reached USD 19.6 mln compared to USD 26.2 mln in the same period in 2004. Strong sales performance has been exhibited by the European subsidiaries of the Group, which contributed USD 3.8 mln to sales. In addition, the franchise operations in Ukraine, which were acquired on 1 January, 2005, contributed USD 2.2 mln of sales compared to USD 1.5 mln.
Cost of sales for the three months to 31 March 2005, reached the level of 26.8% of sales during the three months to 31 March, 2005, compared to 23.1% in the same period in 2004.
Selling & Distribution Costs exhibited an increase of USD 0.6 mln and reached the level of 4.2% of sales, compared to USD 0.4 mln, or 1,2% of sales in the same period last year. Costs were also higher as a result of the consolidation of the costs of the five Ukraine companies acquired as of 1 January, 2005.
Overall, profitability of operations in relation to sales decreased by USD 1.1 mln down from USD 3.7 mln (11.8% of sales) compared to USD 2.6 mln (10.7% of sales).
The share of profits of the investment of the Group in Nutripharma Ltd incurred in September 2004 and the acquisition of the Vision Franchise operations in Ukraine on 1 January, 2005, contributed USD 0.3 mln and USD 0.1 mln to the profitability of the Group during the current reporting period, respectively.
Net Profits attributable to the shareholders fell to USD 2.6 mln for the first quarter from USD 3.7 mln in the three months to 31 March, 2004.
EPS for the three months to 31 March, 2005, stand at 3,46 as compared to 4,98 for the corresponding period in 2004.
Cash and cash equivalents amounted to USD 7.6 mln as at 31 March, 2005, compared to USD 4.3 mln as at 31 December 2004. In this context, the consolidated cash flow statement shows a net increase in cash and cash equivalents of USD 3.3 mln for the three months to 31 March, 2005.
The Group maintains a strong asset and capital structure and is well positioned to support its rapid expansion to other markets and jurisdictions. Long term borrowings and borrowings in total are at very low levels with gearing standing at the level of 25,6% of shareholders’ funds.
Trade and other payables as at 31 March, 2005 stand at USD 28.7 mln compared to USD 26.2 mln as at 31 December, 2004. This increase partly reflects the increase in the commissions accrued on the basis of the stock maintained by the franchisees (USD 1.9 mln), the increase in the provision for the distributors’ incentive program (USD 0.5 mln), a reduction in uncollected commissions (USD 0.1 mln), a reduction in trade payables (USD 0.4 mln) and a reduction in other payables (USD 0.5 mln).
The Directors believe that, in the light of the financial performance of the Group for the three months ended 31 March, 2005, the financial results of the Group for the whole of 2005 will compare favourably with those for the year ended 31 December, 2004.
