Blackmores’ international sales soften during first half
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The chief executive of vitamins group Blackmores says people will keep spending on vitamins and health supplements they consider crucial, but are becoming more discerning about when and where to buy as cost-of-living pressures rise.
Alastair Symington says there’s a noticeable shift in the different channels from which vitamins purchases are being made, with value-oriented consumers hunting for special deals and the lowest price.
“We are seeing a little bit of shifting out of the traditional pharmacy,” he said.
Mr Symington said in the first weeks of February, the volume of sales across the board hadn’t waned, but Blackmores was closely monitoring buying patterns, anticipating that some consumers could start buying fewer items and stick to core purchases.
“We haven’t seen volumes coming down yet,” he said.
Blackmores shares dropped 6.7 percent to $79.06 by late afternoon on the ASX on Thursday after a subdued first-half profit. The group generated net profit after tax of $25.5 million for the six months ended December 31, down 1.4 percent from a year earlier. Revenues fell 1.6 percent to $338 million.
The share price had rallied in the previous four months, gaining 35 percent from $63.71 in mid-October.
Blackmores shares hit $200 in 2016 when the “clean and green” status of Australian vitamin companies fuelled an extraordinary jump in demand from consumers in China, and triggered a buyout of Australian rival Swisse by China-based Health & Happiness.
Questions & Answers
Q.What was Blackmores' net profit after tax for the first half of the financial year?
What was Blackmores' net profit after tax for the first half of the financial year?
Blackmores generated a net profit after tax of $25.5 million for the six months ended December 31. This figure represents a 1.4 percent decrease compared to the previous year.
Q.How have Blackmores' revenues performed during this period?
How have Blackmores' revenues performed during this period?
Revenues for the first half fell by 1.6 percent, reaching $338 million. This downturn aligns with the subdued profit reported by the company for the period.
Q.What impact are cost-of-living pressures having on consumer buying habits for vitamins?
What impact are cost-of-living pressures having on consumer buying habits for vitamins?
Consumers are becoming more discerning, hunting for special deals and lower prices on vitamins. This shift includes moving away from traditional pharmacies to other channels for purchases.
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