1 Apr 2015 13:36
1 April 2015
New Trend Lifestyle Group Plc
("NTLG" or the "Company")
Trading and Strategy Update
New Trend lifestyle Group Plc (AIM: NTLG), the Singapore - based Feng Shui products and services group, announces a trading and strategy update.
At the time of the interim results announcement (24 September 2014) the company announced that the first six months had been very testing for NTLG with a depressed retail environment in Singapore coupled with slower than intended progress in China.
Trading in the second half remained difficult and sales for the year are likely to be approximately 17% down on the previous year. Whilst it is expected that gross margins will remain in the low 70s% (2013: 74%) and overheads have been reduced, the Board expects to report a significantly increased loss before tax for 2014 (2013: loss of SGD496,000). In order to address the loss-making position, the Board has decided to cease all existing retail operations in China with immediate effect and concentrate for the time being on its key Singaporean market. Further details of the revised Chinese strategy are set out below.
The Board believe that these actions will place it in a better position to be trading profitably on a month by month basis by Q4, 2015 and breakeven for the year as a whole. As at 31 March 2015, the Company remained cash positive and the Board believe that NTLG can be put onto a profitable footing without the need for further external capital.
Strategy for Chinese operations
As previously reported the Company has two outlets in China at Dong Men, Shenzhen and Hor Hai. Whilst revenues have increased in China year on year these were from a low base and remain significantly below budget. The China operation continues to be loss making and so is a drain on NTLG's cash resources. The Board have decided to cease all existing retail operations in China, and continue with the current China business development projects (as previously announced) from Singapore. If these activities reach the point where revenue is certain, then the Company will create the necessary infrastructure in China and make the appropriate announcements at this time. In this way, the company will minimise its losses in China and ensure overheads there are matched closely to revenue generation.
Results for the year ended 31 December 2014
The Company will provide an update on current trading when it releases its audited results for the year ended 31 December 2014 in late May 2015.
For further information:-
New Trend Lifestyle Group Plc 0207 653 9850
Robert Goddard, Chairman
Ajay Rajpal, Director & Interim CFO
Zeus Capital (NOMAD and broker)
Ross Andrews, Andrew Jones 0161 831 1512
About New Trend Lifestyle
The Company was established in 2005 by Master Hillary Phang. NTL's Feng Shui services include building and office design consultancy, astrology readings, marriage matching, aura readings and business talks and seminars for large corporations.
NTL is one of the leading branded Feng Shui consultancies in Asia, selling its services to a mixture of high profile businessmen, political figures, business enterprises and the general public. It provides lifestyle guidance to customers, which leads to the provision of a number of products and services.
Feng Shui is endemic in Chinese communities throughout the world and influences many aspects of personal, business and even Government activities and is the basis on which the Company has created a business with a strong brand and deep-seated cultural drivers.