KUALA LUMPUR (March 23): Hai-O Enterprise Bhd's third quarter net profit rose 25.33% to RM19.25 million or 6.64 sen per share, from RM15.36 million or 5.29 sen per share a year earlier, on the back of higher revenue from its wholesale division.

Revenue for the quarter ended Jan 31, 2018, however, fell 3.84% to RM103.07 million from RM107.18 million, said Hai-O in a filing to Bursa Malaysia.

Hai-O attributed the higher earnings to its premium Chinese medicated tonic and sales of vintage Puer tea, as well as gains from the resale of treasury shares of about RM2 million and higher contribution from inter-segment sales.

For the cumulative nine-month period, net profit increased 42.77% to RM58.55 million or 20.18 sen per share, from RM41.01 million or 14.12 sen per share in the previous corresponding period.

Cumulative revenue rose 22.94% to RM351.13 million from RM285.62 million.

The group remains optimistic that it will be profitable in the current fourth quarter.

The multi-level marketing division recently launched its lifestyle related range of products, and Hai-O is optimistic that these new products will bring positive result to the division.

"The collaboration with well-known designers and appointment of product ambassador will enhance the group's image in delivering good quality and fashionable wear to its members," said Hai-O.

It added that its wholesale division will continue to expand its customer base and source for more quality products.

As the bulk of the Chinese New Year sales will be captured in the fourth quarter, Hai-O is confident that its retail division will achieve higher revenue and profit in that quarter.

Shares in Hai-O closed three sen or 0.63% lower at RM4.70 today for a market capitalisation of RM1.37 billion.

Over the past year, the stock rose as much as 50.69%. The counter breached the RM5 level during the period, hitting its all-time high of RM5.48 on Dec 20, 2017.