Bangkok--14 Nov--Minor Corporation
Despite record lows in consumer confidence, months of political uncertainty, a coup in September and flooding upcountry, Minor Corporation (Minor) has achieved 11% and 5% YoY increases in 9M06 revenues and net profits to Baht 2,391 million and Baht 183 million, respectively. 3Q06 revenues and net profits were down by 12% and 30% YoY, respectively due to declining consumer demand and because Minor booked no aircraft sales in 3Q06 compared to one amounting to Baht 89 million in 3Q05. Sales from Minor's growing aircraft distribution business which currently involves large transactions and the sale of three to four aircraft each year tends to produce high quarterly sales and profits depending on when the sales are booked. Sales from the core retail lifestyle brands and contract manufacturing businesses were down by 3% to Baht 614 million due to political and economic uncertainties in 3Q06 and Minor expects that they will continue to restrain sales growth and pressure profit margins though 4Q06.
In 3Q06, Minor's lifestyle brands distribution business was stable despite record lows in consumer confidence and the military coup. The fashion business, led by Esprit and Bossini, and the cosmetics business, led by Red Earth, Bloom and Laneige, achieved sales of Baht 226 million and Baht 56 million, respectively which were largely unchanged compared to sales in 3Q05. Margins, however, decreased from 20% to 5% as aggressive pricing and promotional campaigns were required. Minor's footware brands, including Timberland and Charles & Keith, which were launched since 3Q05 posted sales of Baht 18 million and Baht 10 million, respectively.
In 3Q06, revenues from Minor's contract manufacturing business were down by 5% YoY to Baht 333 million but operating profits were up 66% YoY to Baht 43 million. Minor's new factory, which began operating in 4Q04, continues to benefit from increasing profit margins.
Having increased its stake in MINT from 4.3% to 19.2% since 3Q05 by acquiring shares at Baht 4.0 per share, Minor is pleased with the investment as MINT's share price has increased by 168% since the acquisition to Baht 11.0 per share. The market value of Minor's stake in MINT is approximately Baht 6.0 billion. In 3Q06, MINT announced YoY revenue and net profit increases (excluding exceptional items) of 14% and 20%, 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, Charles & Keith, 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