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DXN to be driven by its expansion plans
DXN to be driven by its expansion plans

The Star

time30-07-2025

  • Business
  • The Star

DXN to be driven by its expansion plans

Maybank IB Research believes DXN's growth prospects lie in its continued geographic expansion into Brazil and Argentina. PETALING JAYA: Analysts are upbeat about DXN Holdings Bhd 's growth prospects despite its first-quarter earnings coming in below expectations. According to RHB Research, the company is attractive in terms of valuations, given that its business will be driven by its expansion plans and healthy cash flow generation. 'DXN's earnings growth will be supported by the relentless growth momentum in major markets. The core strategies to recruit new members and enhance the members' productivity will continue to revolve around member engagements, complemented by quality new product launches,' it explained. The research house added that the recent capacity expansion could help the company to capture the rising demand and roll out new product categories to broaden the addressable markets. 'The consequent efficiency gain together with annual price adjustments will sustain the high gross profit margin of 80%, notwithstanding the rising input and overhead costs,' it said. The research house expected a significant earnings contribution from its venture into Brazil in the next three to four years, leveraging on DXN's existing network in the Latin American region. It maintained a 'buy' call on the stock but with a lower target price of 80 sen (from 88 sen), signifying a 58% upside and 7% financial year 2026 yield. RHB Research said the valuation was below the consumer sector average to take into account the highly regulated direct selling industry DXN is in. The research house pointed out that DXN's results for the first quarter of FY26 (1Q26) missed forecasts due to unfavourable foreign exchange (forex) movements and ongoing currency crisis in Bolivia, which is a key market. It said DXN's net profit of RM74mil, down 14% year-on-year (y-o-y), met only 19% of the research house's and consensus forecasts, mainly due to the unfavourable forex, prompting it to cut FY26 to FY28 earnings by 9%, 6% and 5%, respectively. Maybank Investment Bank Research has kept its 'buy' call and target price of 72 sen as well as its FY26 to FY28 earnings estimates unchanged, pending DXN's 1Q26 results briefing. It said DXN's 1Q26 results came in below expectations mainly due to lower-than-expected sales on unfavourable forex movements against the ringgit. Similarly, Maybank Investment Bank Research has kept its 'buy' call and target price of 72 sen as well as its FY26–FY28 earnings estimates unchanged, pending DXN's 1QFY26 results briefing. It said DXN's 1QFY26 results came in below expectations mainly due to lower-than-expected sales on unfavourable forex movements against the ringgit. 'We caution that the persistent strength in the ringgit may continue to suppress the group's overall sales growth potential. 'Pressure on DXN's overall sales may persist if the ringgit continues to strengthen against the currencies of its core markets (like Latin America), given that its sales in Malaysia is estimated to account for 10% of total group sales, with the remainder in foreign currency,' Maybank IB Research said. Nevertheless, the research house believes DXN's growth prospects lie with its continued geographic expansion into Brazil and Argentina, which it hopes to replicate the successes it achieved in Peru and Bolivia.

DXN 1Q net profit dragged down by forex losses
DXN 1Q net profit dragged down by forex losses

New Straits Times

time29-07-2025

  • Business
  • New Straits Times

DXN 1Q net profit dragged down by forex losses

KUALA LUMPUR: DXN Holdings Bhd's net profit fell by 13.6 per cent to RM73.91 million in the first quarter ended May 31, 2025 (1Q FY2026) from RM85.56 million in the same period last year due to foreign exchange (forex) losses stemming from the strengthening of the ringgit. Revenue, however, edged up 0.8 per cent to RM479.06 million against RM475.05 million previously, the health and wellness consumer product manufacturer said. "This modest growth was primarily driven by continued sales expansion in local currencies, which was partially offset by unfavourable currency translation effects arising from depreciation of the overseas market currencies against the ringgit," it said in a filing with Bursa Malaysia today. DXN said the board has declared a first interim dividend of 0.9 sen per share for 1Q FY2026, involving a payout of RM44.75 million, which will be paid on Aug 29, 2025. This represents a 60.5 per cent payout ratio. In a separate statement, DXN said the group remains positive on its FY2026 prospects despite forex volatility and broader macroeconomics headwinds. "DXN is investing in new manufacturing capacity in Peru and Morocco as well as in Kedah and Kelantan. These developments will enable faster market responsiveness, reduce logistics complexity and support more sustainable, localised production. "They are part of DXN's long-term strategy to strengthen its global supply network while improving both cost and carbon efficiency," it added. -- BERNAMA

DXN 1Q net profit dragged down by forex losses
DXN 1Q net profit dragged down by forex losses

The Star

time29-07-2025

  • Business
  • The Star

DXN 1Q net profit dragged down by forex losses

KUALA LUMPUR: DXN Holdings Bhd 's net profit fell by 13.6 per cent to RM73.91 million in the first quarter ended May 31, 2025 (1Q FY2026) from RM85.56 million in the same period last year due to foreign exchange (forex) losses stemming from the strengthening of the ringgit. Revenue, however, edged up 0.8 per cent to RM479.06 million against RM475.05 million previously, the health and wellness consumer product manufacturer said. "This modest growth was primarily driven by continued sales expansion in local currencies, which was partially offset by unfavourable currency translation effects arising from depreciation of the overseas market currencies against the ringgit,' it said in a filing with Bursa Malaysia today. DXN said the board has declared a first interim dividend of 0.9 sen per share for 1Q FY2026, involving a payout of RM44.75 million, which will be paid on Aug 29, 2025. This represents a 60.5 per cent payout ratio. In a separate statement, DXN said the group remains positive on its FY2026 prospects despite forex volatility and broader macroeconomics headwinds. "DXN is investing in new manufacturing capacity in Peru and Morocco as well as in Kedah and Kelantan. These developments will enable faster market responsiveness, reduce logistics complexity and support more sustainable, localised production. "They are part of DXN's long-term strategy to strengthen its global supply network while improving both cost and carbon efficiency,' it added. - Bernama

DXN focuses on ready-to-eat and -cook products, eyes further global spread
DXN focuses on ready-to-eat and -cook products, eyes further global spread

The Star

time15-07-2025

  • Business
  • The Star

DXN focuses on ready-to-eat and -cook products, eyes further global spread

From left: DXN chief financial officer Lim Beng Cheng, DXN senior independent non-executive director Datuk Noripah Kamso, DXN chief operating officer Mahmood Hisham, DXN founder and executive chairman Datuk Lim Siow Jin, Kedah Chief Minister Datuk Seri Muhammad Sanusi Md Nor, Invest Kedah Bhd chief operating officer Noor Ikhsan Bin Abdul Aziz and Kedah state executive council member Dr Haim Hilman Abdullah. PUTRAJAYA: Herbal health product manufacturer and marketeer DXN Holdings Bhd aims to expand its product portfolio with a new line of ready-to-eat (RTE) and ready-to-cook (RTC) food products, as part of an aggressive push into international markets. Founder and executive chairman Datuk Lim Siow Jin said the company is in the final phase of developing a central kitchen facility to drive production of RTE and RTC products. "The latest freezing technology enables processed products such as sushi- and sashimi-grade fish to last up to 18 months. This opens up export opportunities globally,' he said at a press conference here today. He said the new products - including fresh seafood processed directly from DXN's hatchery in Pulau Tuba, Kedah - are expected to replicate DXN's coffee products, which are now among the company's top revenue contributors. "If coffee can reach that level, daily RTE and RTC food products will even go further,' he said, adding that DXN's products are currently distributed via a network of more than 20 million members in 54 countries. Meanwhile, DXN's chief operating officer Abdul Hafiz Mahmood Hisham said the company is confident it will be able to distribute more than 50 per cent of its net profit as dividend this year, in line with its minimum payout ratio policy. He said for the financial year ended Feb 28 this year, DXN distributed 56 per cent of its net profit as dividends, totalling about RM362 million since its Main Market relisting on Bursa Malaysia on May 19, 2023. On Jan 27, DXN's board declared a third interim dividend of 1.00 sen per ordinary share, amounting to RM49.72 million for the financial year ending Feb 28, 2025. For the full year, the company's net profit rose 5.8 per cent to RM329.03 million from RM310.99 million in the FY2024, while revenue increased 5.84 per cent to RM1.91 billion from RM1.80 billion. This revenue growth was driven by strong sales performance in key markets such as Peru, Bolivia, the Middle East, and Türkiye, supported by targeted marketing strategies that successfully maintained member engagement throughout the year. - Bernama

DXN Holdings landmark agreement paves way for investments, job creation in Kedah
DXN Holdings landmark agreement paves way for investments, job creation in Kedah

The Sun

time15-07-2025

  • Business
  • The Sun

DXN Holdings landmark agreement paves way for investments, job creation in Kedah

CYBERJAYA: DXN Holdings Bhd, a global manufacturer of health-focused nutraceutical products, signed a memorandum of understanding (MoU) with Invest Kedah Bhd, the state's principal investment promotion agency, to explore strategic initiatives in agroforestry, aquaculture, and eco-tourism. The five-year MoU also supports socio-economic and talent development aligned with Kedah's long-term plans. The MoU was formalised during an official ceremony attended by the Kedah chief minister Datuk Seri Muhammad Sanusi Md Nor, who emphasised the importance of partnerships between the state and forward-looking companies. 'We welcome collaborations that align with our vision for a smart, competitive, and sustainable Kedah. 'DXN, a homegrown company which began in Kedah and now has a global reach, sets a benchmark for excellence in both governance and growth for companies in Kedah and Malaysia. 'Their continued investment not only strengthens confidence in our state's economic direction but also contributes to the momentum of our planned economic corridors. 'This is the kind of business leadership that creates real impact for the people of Kedah and can form anchor partners for the Greater Kedah 2050 Vision,' he said in a statement. DXN has deep roots in Kedah. It commenced business in Jitra in 1995 and continues to play a key role in the Company's global operations, with approximately 90% of its production exported across 54 countries. The site is supported by a workforce of around 1,825 employees, reflecting the company's continued investment in local talent while complementing its broader international manufacturing footprint. DXN's collaboration with Invest Kedah builds on that legacy to unlock socio-economic potential through entrepreneurship and innovation, while ensuring that local communities benefit from development across sectors. These initiatives are expected to generate significant employment opportunities and stimulate economic activity in Kedah, with a strong emphasis on engaging local talent, contractors, and entrepreneurs. DXN will also support technology and knowledge transfer to enhance local capabilities. Under the MoU, DXN and Invest Kedah will explore high-impact opportunities through job creation and economic growth in agroforestry, focusing on the cultivation of high-value crops such as coffee and mushrooms in designated forest reserve areas. It will also focus on aquaculture and island ventures, whereby the development of sustainable aquaculture systems for species such as oysters, red snapper, grouper, and coral trout, including those in hatcheries on the island and in coastal zones. The MoU will also focus on eco-tourism in Langkawi, with wellness-driven tourism offerings aligned with DXN's global brand and sustainability ethos. The first project already underway is a fish hatchery on Pulau Tuba, Langkawi, which began operations in March 2024. Spanning 1.02 hectares, the hatchery houses 40 tanks with the capacity to breed up to 480,000 fish, and focuses on red snapper, grouper, milkfish, and coral trout. The facility is designed to serve both commercial production and marine conservation education. DXN founder and executive chairman Datuk Lim Siow Jin said Kedah holds tremendous untapped potential for agro-based and tourism development. 'Through this MoU, we can deepen our footprint in the state while delivering inclusive economic benefits. This reflects our philosophy of building a vertically integrated, sustainable business that grows alongside the communities it serves. 'We sincerely thank the Kedah state government for their partnership. The policies of the state as well as federal governments had enabled a company like ours to take root and grow internationally,' he said. Invest Kedah chief operation officer Noor Ikhsan Abdul Aziz said this public-private initiative is part of the state's broader effort to modernise Kedah's economy. 'By empowering companies like DXN, we are enabling the creation of self-sustaining entrepreneurs and strengthening local supply chains. 'This collaboration demonstrates how strategic investment can support social and economic development across the state,' he said. In Q1 of FY25, Kedah secured RM4.2 billion in investments, with RM3.9 billion in manufacturing. Foreign direct investment (FDI) in Kedah is driven by Kulim Hi-Tech Park (KHTP), Kulim Industrial Corridor (KIC), Bukit Kayu Hitam Special Border Economic Zone (BKH SBEZ), as well as Kedah Rubber City, Kedah Science & Technology Park (KSTP). Kedah is also seeing rapid growth in healthcare, driven by increased public funding and private expansion. Langkawi is positioning itself as a premium wellness destination, integrating rainforest spas, eco-retreats, and holistic healing. Mainland Kedah is directing investment toward eco and cultural wellness tourism in places like Gunung Jerai, Lembah Bujang and Tasik Pedu. The partnership also enables DXN to further strengthen its sustainable value chain. Access to local land for cultivating key ingredients such as cocoa and coffee will reduce reliance on external suppliers, improve cost efficiency, and support quality assurance. This complements DXN's current practice of cultivating spirulina and ganoderma for its own use. As DXN enters its next phase of growth, the company remains focused on strengthening its global presence while delivering long-term value through a sustainable, integrated value chain and ongoing innovation in health and wellness. Equally, DXN is committed to uplifting communities by creating inclusive economic opportunities and building local capabilities—reflecting its belief that business success and community well-being are inextricably linked. With a population of over 2.1 million, Kedah is on track for rapid economic transformation driven by strong industrial FDI, advanced logistics, and high-tech manufacturing. With annual FDI inflows projected at RM40–50 billion and real GDP growth forecast at 5–7% annually, Kedah is poised to become a top-tier investment destination and economic hub in northern Malaysia through major plans like Greater Kedah 2050 and Pelan Kedah 2035.

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