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Malaysian beauty and wellness leader, Esthetics International Group Berhad (EIG), has just unveiled its latest quarterly report, providing a comprehensive look into its performance for the financial year ended 31 March 2025 (FY25). While the Group demonstrated resilience with an increase in revenue, the financial period was significantly impacted by external factors, leading to a shift from profit to a notable loss. This report invites us to delve deeper into the dynamics shaping EIG’s journey, highlighting both its strengths and the challenges it navigates in a cautious economic climate.
Key Takeaway: EIG recorded a 2.4% increase in full-year revenue for FY25, reaching RM183.6 million. However, the Group registered a loss before tax of RM5.7 million for FY25, a stark contrast to the RM1.1 million profit before tax in FY24, primarily due to unrealised foreign exchange losses.
Overall Financial Snapshot: A Mixed Picture
EIG’s financial performance for the fourth quarter (4Q25) and the full financial year (FY25) presents a mixed bag. While revenue saw a modest uptick, profitability was significantly challenged, largely due to foreign exchange movements and increased operational costs.
Quarterly Performance Deep Dive (4Q25 vs 4Q24)
4Q25 Highlights
Revenue: RM 45.31 million
Loss Before Tax: RM (3.71) million
Net Loss: RM (4.28) million
Basic Loss Per Share: (1.81) sen
4Q24 Comparison
Revenue: RM 44.72 million
Loss Before Tax: RM (1.54) million
Net Loss: RM (2.34) million
Basic Loss Per Share: (0.99) sen
For the fourth quarter, EIG’s revenue increased by 1.3% to RM45.31 million compared to RM44.72 million in the same period last year. However, the loss before tax widened significantly to RM3.71 million from RM1.54 million in 4Q24. This expanded loss was partly attributed to an unrealised foreign exchange loss of RM0.9 million in 4Q25, contrasting sharply with an unrealised exchange gain of RM0.4 million in 4Q24. Additionally, higher marketing activities and increased provision for stock obsolescence contributed to the pressure on profitability.
Full-Year Perspective (FY25 vs FY24)
FY25 Highlights
Revenue: RM 183.63 million
Loss Before Tax: RM (5.67) million
Net Loss: RM (8.92) million
Basic Loss Per Share: (3.76) sen
FY24 Comparison
Revenue: RM 179.33 million
Profit Before Tax: RM 1.13 million
Net Loss: RM (1.55) million
Basic Loss Per Share: (0.65) sen
On a full-year basis, EIG’s revenue grew by 2.4% to RM183.63 million in FY25 from RM179.33 million in FY24. Despite this revenue growth, the Group reported a loss before tax of RM5.67 million for FY25, a significant reversal from the RM1.13 million profit before tax in FY24. The primary culprit for this shift was unrealised foreign exchange losses in FY25, as opposed to unrealised foreign exchange gains in FY24. The report notes that excluding these unrealised forex impacts, the group would have recorded a loss before tax of RM2.0 million for FY25, compared to a loss of RM0.6 million for FY24, indicating underlying operational challenges beyond just currency fluctuations.
Segmental Performance: A Tale of Three Businesses
EIG’s diversified business units showed varying performance, reflecting the different market dynamics each operates within.
- Professional Services and Sales (Corporate Outlets): This segment, encompassing EIG’s 56 AsterSpring salons and retail counters, continued its positive trajectory. Revenue for 4Q25 increased by 3.7% to RM27.61 million, turning an operating loss of RM0.2 million in 4Q24 into an operating profit of RM0.8 million. For the full year, revenue rose by 4.4% to RM109.37 million, with operating profit improving to RM6.88 million from RM5.39 million in FY24. This indicates strong operational efficiency and demand in their core service offerings.
- Product Distribution (Professional Distribution and FMCG): This segment faced headwinds. 4Q25 revenue declined by 10.7% to RM13.62 million, and operating loss widened to RM4.99 million from RM2.32 million in 4Q24. The full-year revenue for FY25 was 7.7% lower at RM59.34 million, resulting in a significantly higher operating loss of RM14.85 million compared to RM6.24 million in FY24. Lower revenue and adverse unrealised foreign exchange movements were key factors here.
- Ecommerce: E-commerce continued its growth momentum, with 4Q25 revenue at RM3.78 million (up from RM2.81 million in 4Q24). While operating profit for the quarter saw a slight dip to RM0.21 million (from RM0.28 million), the full-year performance was robust, with revenue surging to RM14.54 million (from RM10.17 million in FY24) and operating profit increasing to RM1.47 million (from RM1.07 million). This highlights the increasing importance of digital channels for the Group.
Geographically, regional and export business contributed 39% of the Group’s revenue, with domestic business accounting for 61% for FY25.
Financial Health and Cash Flow
EIG’s balance sheet showed a slight contraction. Total assets decreased to RM253.80 million as at 31 March 2025 from RM276.18 million a year ago. Total equity also saw a reduction, standing at RM149.80 million compared to RM161.12 million previously, leading to a lower net asset per share of RM0.63 from RM0.68.
From a cash flow perspective, the Group generated a healthy RM17.41 million in net cash from operating activities in FY25, an increase from RM16.59 million in FY24. However, investing activities used RM4.64 million, primarily for property, plant, and equipment acquisition and advances to associates, a shift from generating RM9.96 million in FY24. Financing activities continued to utilise significant cash, amounting to RM23.33 million, mainly due to lease payments and loan repayments. Consequently, cash and cash equivalents decreased from RM32.41 million at the beginning of the year to RM23.27 million at the end of FY25.
Risks and Prospects: Navigating a Challenging Landscape
EIG acknowledges the challenging operating environment, citing cautious consumer sentiment and uncertain global macroeconomic factors. Despite these headwinds, the Group remains committed to its strategy of growing as a leader in professional skin care services and building its own and selected distribution brands on an omnichannel basis across ASEAN and Hong Kong.
The long-term outlook for the beauty and wellness industry in the region is viewed positively, suggesting potential for future growth once current market uncertainties subside. EIG’s continued focus on its core strengths and adapting its omnichannel strategy will be crucial in navigating these dynamics.
Dividends: A Prudent Approach
In light of the prevailing uncertain external macroeconomic environment, EIG did not declare or pay any dividend during the quarter under review (4Q25). The last dividend paid was a final single-tier dividend of 0.5 sen per ordinary share for the previous financial year ended 31 March 2024, amounting to RM1.19 million, which was disbursed on 20 November 2024.
Summary and
Esthetics International Group Berhad’s latest financial report paints a picture of a company diligently working to maintain its market position amidst challenging conditions. While revenue growth, especially in its core Professional Services and Sales and E-commerce segments, demonstrates underlying business strength, the significant impact of unrealised foreign exchange losses on overall profitability cannot be overlooked. The Group’s strategic focus on omnichannel expansion in key regional markets is a sensible long-term approach, aligning with the positive growth potential of the beauty and wellness industry.
However, investors should be mindful of the current headwinds. The widening losses, particularly in the Product Distribution segment, and the overall negative impact of foreign exchange movements, indicate that the path to consistent profitability may be arduous in the short term. The prudent decision to withhold dividends reflects the Board’s cautious stance in preserving capital.
Key risk points to consider for EIG include:
- Continued volatility in foreign exchange rates, which can significantly impact reported earnings.
- Sustained cautious consumer sentiment, affecting discretionary spending on beauty and wellness products and services.
- Intense competition within the beauty and wellness industry across its operating regions.
- The ability to effectively manage inventory and marketing costs to improve operational efficiency.
EIG is clearly in a phase of navigating external pressures while trying to build on its fundamental strengths. Its ability to adapt and execute its omnichannel strategy will be key to its future success.
From a professional standpoint, EIG’s performance highlights the complexities of operating a regional business with diverse segments. The strong performance of its Professional Services and Sales, coupled with robust e-commerce growth, suggests that its core service and digital transformation efforts are yielding results. However, the struggles in product distribution and the pervasive impact of forex fluctuations underscore the need for continued strategic adjustments and perhaps a deeper dive into mitigating currency risks.
Given these dynamics, how do you see EIG balancing its growth ambitions with the prevailing market challenges in the coming years? Share your views and insights in the comment section below. Let’s discuss what this report means for EIG’s future!
