Tycoon Group Announces 2022 Annual Results

A Record High Revenue for a Financial Year since the Inception of the Group

Resumption of Normal Traveller will Boost Sales, Diversified Strategies Helps the Group to Achieve New Growth and Height

Results Highlights

• Tycoon Group recorded revenue of approximately HK$1,186.2 million for FY2022, a record high for a Financial Year since the inception of the Group and a year-on-year increase of 33.4%.
• The Group's successful turnaround was mainly due to the opimisation of the product portfolio, and the continuous efforts to develop and expand e-commerce sales. Net profit of the Group rebounded significantly to HK$43.6 million. EBITDA* of the Group for FY2022 was HK$79.7 million, representing a staggering increase of 1,135.8% compared to HK$6.4 million for FY2021.
• The growth trend of the Group's e-commerce business continued. During the Financial Year, the revenue from the e-commerce business of the Group increased by 35.3% to HK$738.7 million as compared to HK$546.0 million for the Last Financial Year.
• The Group's "Double 11" e-commerce sales for the Financial Year were satisfactory at approximately HK$166.0 million, representing a significant year-on-year increase of approximately 118.4% compared to approximately HK$76.0 million for the same period in FY2021.
• The Group continues to optimise its product portfolio and consolidate the market advantages of its distribution business. During the Financial Year, the distribution business of the Group recorded sales of HK$447.5 million, an increase of 31.7% over the Last Financial Year of HK$340.0 million.
• The Group's offline distribution channels in Mainland China are gaining momentum, with the overseas healthcare brands it represents being sold through health and beauty chains in Mainland China, such as Mannings, Watsons, Olé, Sam's Club, PureH2B and Rainbow Shopping Mall etc.
• The Group continues to strengthen its international presence and global advantages. After obtaining the sole distributorship in China for the global best-selling probiotic brand, Culturelle®, the Group has also successively obtained the exclusive distribution rights in Hong Kong for Japanese anti-hair loss and hair protection brand, Kaminowa; French number one baby washing care brand, Biolane; and also Korean anti-hair loss and hair protection brand, Dr Banggiwon. For Biolane, the Group has also obtained exclusive distribution rights in Singapore and Malaysia. In addition, the Group has also secured exclusive distribution rights in Hong Kong and Macau for Nu-Prep, the best-selling star product of the Malaysian herbal health product brand of Biotropics Malaysia.

HONG KONG, March 29, 2023 /PRNewswire/ -- Tycoon Group Holdings Limited ("Tycoon Group" or the "Group", Stock Code: 3390.HK), an omnichannel marketing and management service integrator of healthcare and well-being related products in Hong Kong, announced its audited consolidated annual results for the year ended 31 December 2022 (the "Financial Year" or "FY2022").

In the Financial Year, the Group recorded revenue of approximately HK$1,186.2 million, a record high for a financial year since the inception of the Group and an increase of 33.4% over the revenue of HK$888.9 million for the year ended 31 December 2021 ("Last Financial Year" or "FY2021"). The Group's net profit rebounded significantly to HK$43.6 million, compared to a consolidated loss of HK$17.4 million in Last Financial Year. While EBITDA of the Group for FY2022 was HK$79.7 million, representing a staggering increase of 1,135.8% compared to HK$6.4 million for FY2021. The Group's successful turnaround was mainly due to an increase in the Group's overall revenue and gross profit, and the impact of a significant decrease in the write-down of inventories. Such increase was mainly attributable to (i) the optimisation of the product portfolio; and (ii) the increase in e-commerce sales as a result of continuous efforts to develop and expand e-commerce sales, as well as the benefit of the "Double 11" promotional campaign in Mainland China. In view of the successful turnaround of the Tycoon Group during the Financial Year and the promising profit prospects, the board of directors of the Company resolved to declare a final dividend of HK3 cents in cash per ordinary share for FY2022 (FY2021: Nil) as a reward for shareholders' support.

E-commerce business continues to grow, while the offline distribution channels in Mainland China are gaining momentum

The growth trend of the Group's e-commerce business continued. During the Financial Year, the revenue from the e-commerce business of the Group increased by 35.3% to HK$738.7 million as compared to HK$546.0 million for the Last Financial Year. The Group's "Double 11" e-commerce sales for the Financial Year were satisfactory at approximately HK$166.0 million, representing a significant year-on-year increase of approximately 118.4% compared to approximately HK$76.0 million for the same period in FY2021. It is expected that the trend of online shopping to continue in the future. In addition, most offline consumers who have a need for cross-border imported healthcare products have become online e-commerce platform users. The Group will continue to work hard to develop its e-commerce business and explore the blue ocean market in Mainland China.

During the Financial Year, the Group continued to strengthen its offline distribution channels in Mainland China, such as Mannings, Watsons, Olé, Sam's Club, PureH2B and Rainbow Shopping Mall etc health and beauty chains. Meanwhile, the Group continued to develop its omnichannel brand marketing and management business and upgrading the Group's business chain and diversifying the Group's product portfolio and businesses, helping increase the Group's market share and gross profit margin.

Sourcing diversified international distributed brands and further expand the Group's distribution business 

The Group continues to actively source multiple overseas healthcare brands, such as the exclusive distribution rights in Hong Kong for Japanese anti-hair loss and hair protection brand, Kaminowa; French number one baby washing care brand, Biolane; and also Korean anti-hair loss and hair protection brand, Dr Banggiwon. For Biolane, the Group has also obtained exclusive distribution rights in Singapore and Malaysia. By optimising its product portfolio to consolidate the market advantages, the distribution business of the Group recorded sales of HK$447.5 million, an increase of 31.7% over the Last Financial Year of HK$340.0 million.

The Group also obtains the sole distributorship in China for the probiotic brand, Culturelle®, which has sold well in Mainland China during the epidemic because of its ability to promote intestinal health and strengthen the immune system. As for the newly distributed Korean anti-hair loss and hair protection brand, Dr Banggiwon, it has been selling well in Korea without any advertisement due to its excellent anti-hair loss effect and good value for money, and has been well-received in Hong Kong since its launch. With increased consumer awareness of hair care and an ageing population, the Group is optimistic about the future sales prospects of anti-hair loss products.

In addition, the Group is also actively establishing and developing its own brands, including "Boost & Guard (BG 博健科研)", "Wakan (和漢)", and "Kinmen (金門)", which has launched a number of healthcare products and are well-received by consumers.

Actively developing business in the Southeast Asia to expand the market opportunities for the Group

The Group was quick to respond and actively expand the sales business in Singapore and Malaysia, as countries in Southeast Asia were among the first to recover from the epidemic outbreak. The Malaysian and Singaporean subsidiaries of the Company have acquired the exclusive distribution rights of TJ-TYT Pharmaceuticals (M) Sdn. Bhd. to strengthen its sales network and increase its customer base.

During the Financial Year, the Group also entered into a strategic collaboration agreement with Biotropics Malaysia Berhad ("Biotropics Malaysia"), a company wholly owned by Khazanah Nasional Berhad, a Malaysian state-owned sovereign fund. Through this strategic partnership, the Group will leverage on its extensive brand management and marketing experience to bring Biotropics Malaysia's premium natural health products (including Nu-Prep, its best-selling star product) to the Greater China region, building international awareness for the brand.

Continuing to partnership with international brands and strengthen the Group's overseas presence

The Group continued to strengthen its overseas presence and added sourcing centres in France, South Korea and Vietnam during the Financial Year. In addition, a subsidiary of the Company entered into a cooperation agreement with a company under JD Logistics, Inc. (Stock Code: 2618.hk) and Fadong (Dongying) E-Commerce Co., Ltd. This is not only to attract and source more European brands and products, but also allow the Group to explore opportunities in the European market. The partnership enables the Group to consolidate its valuable resources and establish a presence in France, thereby optimising the Group's product portfolio and broadening its revenue stream, which will be a stepping stone for the Group to explore opportunities in the European market.

Mr. Wong Ka Chun Michael, the Chairman and the Chief Executive Officer of Tycoon Group, said, "After three years of waiting for the epidemic to end, the Hong Kong retail market has finally seen the promising prospects. With the efforts and support from our shareholders, business partners and colleagues during the epidemic, the Group was able to stand firm despite the market headwinds and grow its revenue in an orderly manner, and even succeeded in achieving a record high in revenue for a Financial Year since the inception of the Group.

I look forward to 2023, when normal customs clearance is restored and the economy returns to normal, attracting a large number of tourists, which will lead to an explosive growth in the local retail market and further recovery of the Group's offline distribution business to pre-epidemic levels or even beyond.

Looking ahead to 2023, with the resumption of normal travel between Mainland China and Hong Kong and the economy returns to normal, attracting a large number of tourists, which will lead to an explosive growth in the local retail market and further recovery of the Group's distribution business to pre-epidemic levels or even beyond. The Group will continue its effort to expand omnichannel marketing and management service and diversify its sales network. With a multi-pronged approach and active expansion into the Southeast Asian market, I believed that the Group's scale and strengths will continue to grow. The Group will achieve further growth in revenue and record-breaking results, in return for the support of all parties.

*Note:

EBITDA is a non-HKFRS measure used by the management for monitoring the core business performance of the Group. EBITDA is calculated based on profit/(loss) for the year before interest, tax expense/(credit), depreciation and amortisation, where "interest" is regarded as including finance income and finance costs.

About Tycoon Group Holdings Limited (Stock Code: 3390)

Tycoon Group is a reputable omnichannel brand marketing and management service integrator of health and well-being related products. The Group specialises in providing one-stop services for PCM, health supplements, skincare, personal care and other healthcare products, including omnichannel brand agent, marketing, management, distribution and sales. The Group has established a strong online and offline sales network in Hong Kong, Macau and the PRC by cultivating the industry for many years with the mission of bringing health and vitality to consumers in Mainland China, Hong Kong, Macau and Asia-Pacific. The Group has provided over 100 local and foreign brands. With a vision of establishing its own brands of products, the Group develops Private Label Products under its well-received brands including "Boost Guard (BG 博健科研)", "和漢 (Wakan)", and "金門 (Kinmen)". Tycoon has established sound relationships with chain retailer customers and is also one of the major distributors for PCM in Hong Kong. For more details, please visit the Group's official website: https://www.tycoongroup.com.hk/.

SOURCE Tycoon Group Holdings Limited