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Financial Information

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Financial Statements And Dividend Announcement For The 12 Months Ended 31 December 2015

Financials Archive

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Profit & Loss 4Q2015

Review Of Performance

Today OSIM operates in 23 countries around the world.

For the 3 months ended 31 December 2015, sales remained soft due to the overall weaker environment.

Profitability

Profit after tax for Q4 was $9 million impacted by the one-off loss of $5.6 million when ONI Australia entered into voluntary administration and $3.4 million legal fees for the TWG Tea legal cases.

Profit after tax for the year was $51 million impacted by the one-off loss of $5.6 million when ONI Australia entered into voluntary administration and $10.1 million legal fees for the TWG Tea legal cases.

During the year, we have also incurred capital expenditure in building more TWG Tea outlets in Hong Kong, Taiwan and China that also resulted in increased wages and rental expenses.

Cash Flow

Cash flow generated from operations during the quarter was $30 million.

During the quarter, we invested $4.1 million to open new outlets, upgrade existing outlets and expand TWG Tea outlets in Singapore and North Asia.

Net cash outflow used in financing activities increased mainly due to purchase of shares of $17 million in Q4 2015.

As at 31 December 2015, cash and cash equivalents of the Group stood at $358 million. Including fixed income investments of $39 million, total cash & cash equivalents and fixed income investments were $397 million.

The reduction in outlets during the quarter is mainly due to ONI Global exiting the Australian nutrition market at the end of 2015. Meanwhile we will also monitor continuously the performance of our outlets.

Total capital expenditure for the year was $14.3 million.

Strengthened Balance Sheet - Net Cash Position

As at 31 December 2015, we were in a net cash position of $172 million. Including fixed income investments of $39 million, the total net cash and fixed income investments was $211 million.

Net assets as at 31 December 2015 were $448 million.

The Board is pleased to propose a final dividend of 2 cents per share.

Commentary on Current Year Prospects

2015 was a challenging year where retail sales across the core countries have been soft. The year has been plagued by challenges from gyrating markets and currency turmoil in the region. Despite these challenges, our dominant brand has enabled us to maintain a stable gross margin with a positive cash generative business. Using our strong balance sheet, we continue to invest in new innovative products and dynamic marketing activities.

Sales for the year were $620 million with a profit before tax of $71 million. During the year, we incurred legal fees of $10.1 million for TWG Tea legal cases. In addition, there was also a one-off $5.6 million loss (comprising the loss on deconsolidation of $2.9 million and loss arising from administration of $2.7 million) when ONI Australia (a subsidiary of ONI Global) entered into voluntary administration at the end of 2015. ONI Australia's average operating loss for the last 3 years was about $3.5 million per year. Accordingly, ONI Global will exit the Australian nutrition market and will incur no further operating losses in the future.

OSIM has 534 outlets. New products including uMagic, uInfinity Luxe, uDiva Classic, uSqueez Air and uTrek have sustained our dominant position in the market. We continue to target new outlets while rationalising existing ones.

GNC/RichLife has 197 outlets. We are growing sales through new innovative product launches and data mining both offline and online. We are targeting to open 5 to 8 new outlets this year.

TWG Tea has 52 outlets. We are targeting to open 15 to 20 new outlets this year and are creating new lines of luxury tea.

The directors are pleased to recommend a final dividend of 2 cent per share making a total of 6 cents per share for 2015.

Balance Sheets

Balance Sheet 4Q2015