Hai-O Corporate Presentation - Apr 2020...Multi Level Marketing (“MLM”) Wholesale Retail Manufacturing & Others Hai-O Corporate Section Update 5 197501000919 (22544-D) 6 MLM Segment

Corporate Presentation

April 20201

197501000919 (22544-D)

Contents Overview

Business Operation Review

2

Financial Highlights

Dividend Policy

Hai-O Corporate Section Update

197501000919 (22544-D)

Overview

Present

Established in 1975 – Famous Household Name

Listed on Bursa Malaysia 2nd Board in 1996 - 1st Local Integrated Traditional Healthcare & Wellness Company Listed on Bursa. Transferred to Main Board on 8th Oct 2007

Principal business – Wholesale, Multi Level Marketing (MLM), Retail, Pharmaceutical Manufacturing, Modern TCM clinics

Product Focus : Wellness and Beauty, Traditional, Complementary and Alternative Medicine products & services

1975

3Hai-O Corporate Section Update

Overview

Mission

• We are committed to promoting healthcare culture and improving human's well-being.

Vision

• We aim to become the premier healthcare company in Malaysia and thereby bringing the greatest value and pride to our customers, business partners, employees and shareholders.

Corporate Values

• Social Responsibility

• Excellent Services

• Attitude

• Growing

• Unity

• Loyalty

• Learning


Business Operations Review

Multi Level Marketing (“MLM”)

Wholesale

Retail

Manufacturing & Others


197501000919 (22544-D)

6

MLM Segment


One of the leading Home-grown MLM companies in Malaysia

✓ HQ in Klang, Selangor – Wawasan Hai-O;

✓ Regional offices / branches in Jakarta - Indonesia, Brunei & Singapore;

✓ >79,000 active members (FYE30/4/2019 : 121,000);

✓ 37 stockists, branches and sales point nationwide and Brunei;

✓ About 80% members are Bumiputra & majority are female;


MLMCore Drivers

• Offering Fair and Attractive Commission Scheme, up to 67% payout ratio;

• Offering Quality and wide range of products;

• Offering Attractive Overseas Incentive Trip annually;

• Strong corporate branding “Sahajidah Hai-O” – clearly differentiate MLM business model with other divisions;

• Effective training;

• Resilient Distributors Force & Focused Management Team;

• Leverage on IT to improve efficiency and CRM;

• E-commerce, Digitalisation & Social Marketing.

“SHOM is committed to fostering entrepreneurship skills in Bumiputra and encourage dealers make this business as a career of choice.”


MLM

9

Strategic Goals

To spur the growth and development of

distributors.

To enhance Company’s visibility

and branding.

To upgrade internal system and strengthen

digital platforms

Optimise productivity & efficiency to achieve

profitability.

To streamline & diversify into

profitable product range.


Development of Business Network & Members’ Growth

✓ Our strategies to “Recruit, Retain & Reward” members;

✓ Offering convenient business startup services, such as business starter reward plan/ easy payment facilities;

✓ To nurture & develop young, aspiring entrepreneurs;

✓ To establish progressive educational programs to equip distributors of all rankings with competitive advantages in doing business.

Hai-O Corporate Section Update 10

✓ Over 2,000 distributors qualified for the Overseas incentive trips to placessuch as Italy, Gold Coast & Melbourne, Australia, Korea, Switzerland & Paris,Hong Kong and some main cities of China;

✓ Offer attractive package to new member & renewed members group;

✓ Initiate programs targeted “enthusiastic young group”;

✓ Upgrade incentive campaigns & revise reward plan.


Rewards & Incentives

Wide range of Products offering


Food & Beverages

Beauty, Skin care &

Personal care

Health supplements & Nutrition food

Household & Accessories

Wellness products

Food & Beverages


Health supplements & Nutrition Food


Health supplements & Nutrition Food


Wellness Products


Beauty, Skin Care & Personal Care






infinence Footwear & Bags


NEW PRODUCTS


New Product (May 2019):i) Cozuma High Precision Liquid Eye Linerii) Cozuma Fiber Lash Mascara


New Product (Oct 2019):i) PB 360 Thera Pants







New Product (Oct 2019):ii) infinence Treatment Serum Range







New Product (Oct 2019):iii) infinence Men’s Radiation Protection Boxer

✓ Anti-EMF (radiation);

✓ Anti-bacterial;

✓ Breathable, Silky soft, Quick dry;

✓ Seamless 3D Design.




New Product (Oct 2019):iv) Nurich DB-13


New Product (Mar 2020):v) The Evertote Series Bag


BUSINESS ACTIVITIES UPDATE











31 MARCH 2020




Wholesale


197501000919 (22544-D)

Wholesale

✓ 100 wholesalers and 2,000 retailers including Chinese Medical Halls,Restaurants, Pharmacies and Modern Trade Channels;

✓ Exclusive Distribution Rights for over 50 renowned brands of ChineseMedicines, health tonic, tea and healthcare products.

✓ Centralised purchasing support for the MLM & Retail Segment.


Wholesale Strategies


Strategic Goals

New market penetration

To extend key account customers i.e. Modern Trade

channel, Pharmacies, Restaurant chain, etc.

Appreciation incentives for customers

To attract new customers and retain existing

customers

Versatile products assortment

Enhance visibility and identify profitable product lines &

deepen products penetration thru new usage & export market

Collaboration with Retail segment

Leveraging Hai-O Raya retail network for market expansion and

product introduction

Digitalisation & Cost Optimization

To continue upgrade digital platforms, social media and

improve cost efficiency

56

Cooking Wine, Health Tonic, Tea & Wine

https://mall.hai-o.com.my/product_info.php?products_id=68




Develop Non-Alcoholic Products: i) Medetop Coconut Oil iv) Bird’s nest – concentrated & ready to drinkii) Herbal Beverages v) Guiling Gao Herbal Jelly iii) Canned food


Potential Export Market - Bird nest products

✓ Production facility for bird nest products are internally certified by GMPand HACCP;

✓ We obtained the export permit from Certification and AccreditationAdministration of the People’s Republic of China (“CNCA”);

✓ Sarangyan brand bird’s nest is available at main shopping malls at KLCC,Pavilion and Guardian in KLIA.


New Hai-O eStore


Retail


197501000919 (22544-D)

Retail ✓ A leading herbs & healthcare products chain stores in Malaysia;

✓ 57 outlets, including 7 franchise;

✓ Carry an extensive range of Traditional Chinese Medicines (TCMs), teas, health tonic, wines, gift packs or hampers and other healthcare products;

✓ As part of quality service, also provide TCMs advice to customers. Chinese physician at selected retail outlets to provide value added services in the form of general medical consultation and product knowledge.


Retail Strategies


Strategic Goals

Improve product mix

Focus on high margin house brands products (contribute >40% sales)

Monthly Special incentive

To motivate outlets staff

Intensify A&P program

To continue design attractive promotion package and joint collaboration with business

associatesProvision of Chinese

Physician TCM consultation as value

added services

Human capital

Continuous training business analysis skills and

improving selling skills

Digitalisation & Cost Optimization

To continue improve digital platforms, social media and

improve cost efficiency

Value & General Herbs, Health & Food Supplements, etc.


Manufacturing & Others


Manufacturing ✓ 1st Company awarded with GMP TCM factory status in Malaysia;

✓ Maintained 2 GMP plants – cater for Halal and Non-Halal products;

✓ Produce quality traditional pharmaceutical products and food supplements;

✓ Supply to in-house and OEM customers. Services include product MAL registration and in-house product QC;

✓ ISO 9001:2015, GMP certified, FDA registered, HACCP certified, MS ISO/EIC 17025 SAMM accredited.


Manufacturing ✓ The new GMP plant in Jalan Kapar Klang

fully commissioned in 2015 and hasobtained HALAL certification for most ofthe products;

✓ Support the products development forMLM & Retail Segments. Expect highercontribution in near future.


JV – TCM ClinicTong Ren Tang (3 outlets)

✓ Established since Qing Dynasty (Year 1669);

✓ Listed in HK and Shanghai;

✓ GMP status awarded;

✓ Provide qualified medical practitioners from China;

✓ Sole distributor of Tong Ren Tang products.


Awards & Accolades

Centurion of the Year (Nov 2019)

Highest Growth in Profit After Tax over 3 years (Nov 2019)

Highest Returns to Shareholders over 3 years (Nov 2019)

Forbes Asia “Best Under A Billion” for 4 consecutive years (2007-2010)

Anugerah CSR Perdana Menteri 2009 Honourable Mention for Outstanding Work in Empowerment of Women

Asean Corporate Governance Transparency Index, Findings & Recognition 2015 Merit Award for AGM Conduct & Minutes Disclosure by MSWG

Best Under Billion Awards 2015 Best in Transparency by Focus Malaysia

AREA (Asia Responsible Entrepreneurship Award) under Social Empowerment Category 2016 by Enterprise Asia


New Awards/ Certification

Awarded by The Edge Malaysia on 12 Nov 2019:

1. Centurion of the Year;

2. Highest Growth in Profit After Tax over 3 years;

3. Highest Returns to Shareholders over 3 years;


Awards & Accolades


Dividend Policy

✓ Dividend policy to distribute at least 50% of the profit for the year asdividend remains unchanged;

✓ FY2015 – 100% dividend payout ratio (15 sen) - to reward ourshareholders commemorating Hai-O’s 40th anniversary;

✓ FY2016 – 80% payout ratio (15 sen);




✓ FY2020 – 3 sen 1st single tier interim dividend paid on 5 March 2020

– 3 sen 2nd single tier interim dividend (book closure date to

be announced in due course).



RM’000

Q&AThank You

Wisma Hai-O, Lot 11995

Batu 2, Jalan Kapar

41400 Klang, Selangor D.E.

T : 03-33423322 F : 03-33434257

www.hai-o.com.my


197501000919 (22544-D)

Documents

Hai-O Corporate Presentation - Apr 2020...Multi Level Marketing (“MLM”) Wholesale Retail Manufacturing & Others Hai-O Corporate Section Update 5 197501000919 (22544-D) 6 MLM Segment