Business Review

Sales for our Health and Beauty Division benefitted from strong revenue and like-for-like sales growth in our Guardian business in Southeast Asia. Improvements in the customer range, particularly in the Beauty category, as well as investments in store fitout supported sales growth. Like-for-like sales for both China and Macau also improved over the course of the year as we continued to improve the customer offer. However, these positives were offset by the impact that the social unrest in Hong Kong has had on Mannings, with the business seeing decline in foot traffic both from visitors to Hong Kong and local customers.

Reported sales for our Health and Beauty Division were US$3.1 billion in 2019, ahead of 2018, supported by the consolidation of Rose Pharmacy.

Diversity in our business geography mix saw robust profit growth by Guardian Indonesia, Malaysia and Singapore partially offset challenging trading conditions which impacted Mannings Hong Kong. The good performance of our Southeast Asia business was driven by strong sales growth as well as better mark-down management. Overall, operating profit for the Division reduced 11% to US$296 million.

In the Philippines, Rose Pharmacy’s profitability also improved materially. The acquisition of the remaining 51% interest in the business in late 2018 allowed the Group to accelerate growth in new stores as well as investment into Own Brands, with financial performance improving as a result.

We continued to improve the customer offer throughout the Health and Beauty Division. Some examples include the relaunched Mannings cross-border e-commerce offering through a WeChat mini programme, with a significant increase in range and Guardian Singapore’s exclusive partnership with leading Korean health and beauty retailer Olive Young.

We are also beginning to leverage the strong brands that we have within our Health and Beauty portfolio, with the introduction of Mannings Own Brand into almost 450 Yonghui stores across China, as well as Wellcome Taiwan stores.