Bangkok--15 Aug--Minor Corporation
Minor Corporation’s (Minor) retail lifestyle brands and contract manufacturing businesses helped to drive 2Q06 sales up 17% YoY to Baht 723 million despite a challenging political and economic environment. However, 2Q06 net profit declined by 45% YoY to Baht 40 million due to changes in how Minor accounts for its investment in Minor International (MINT). In 2Q05, when it was only a 4.2% shareholder in MINT, Minor recorded Baht 54 million in cash and stock dividends from MINT. In 2Q06, however, Minor equity accounted for its 19.2% stake in MINT and its share of profit from MINT (net of financial costs and goodwill) was only Baht 5 million. MINT pays dividends annually during the second quarter and such YoY differences are not expected in 3Q06 and 4Q06. Excluding exceptional items, profit from MINOR’s core lifestyle brands and contract manufacturing businesses in 2Q06 was up Baht 8.2 million or 26% YoY.
In 2Q06, Minor’s fashion business, led by Esprit and Bossini, achieved sales growth of 7% YoY to Baht 299 million while Bloom and Laneige helped the cosmetics business increase sales by 11% to Baht 65 million. As the sole distributor of Cessna aircraft in Thailand, Minor’s aircraft sales, servicing and distribution company booked income of Baht 18 million in 2Q06 compared to Baht 1 million in 2Q05. Timberland, which was launched in Thailand at the end of 2005 posted sales of Baht 19 million in 2Q06. In 2Q06, Minor launched Charles & Keith, a leading ladies footwear brand, and continued to explore ways to introduce exciting new brands in Thailand.
Revenues from Minor’s contract manufacturing business were up 32% YoY to Baht 365 million. Minor’s new factory, which began operating in 4Q04, continued to benefit from orders received in 1Q06 from customers to increase production of a number of products including fabric softener.
Having increased its stake in MINT from 4.3% to 19.2% in 3Q05 by acquiring shares at Baht 4.0 per share, Minor is pleased with the investment as MINT’s share price has increased by 150% since the acquisition to Baht 9.9 per share. Minor also booked an investment valued at Baht 271 million in 2Q06 when it received 55 million warrants at no cost. Last week, MINT announced a 61% YoY increase in 2Q06 net profit as sales from the food and hotel businesses were up 25% and 13%, respectively.
Minor Corporation (Minor) is a leading distributor of international lifestyle brands in Thailand focusing primarily on fashion, cosmetics and education. Its brands include Esprit, Red Earth, Bossini, Timberland, Bloom, Laneige, Elemis, Tumi, Henckels, Time Life, and World Book. It owns and operates one of Thailand’s leading contract manufacturers. It maintains an investment portfolio of listed and private securities including a 19.2% stake in Minor International. For more information on Minor, please visit www.minornet.com
Press Contacts: Pratana Manomaiphiboon /
Prapharat Tangkawattana / Jim Fralick
at Tel: (662) 381-5151