Outlook. We believe 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. Meanwhile, the recent capacity expansion should help to
capture the rising demand and roll out new product categories to broaden
the addressable markets. In addition, the consequent efficiency gain,
together with annual price adjustments will sustain the high GPM of c.80%
notwithstanding the rising input and overhead costs. On top of that, we look
forward to the result of the group’s entry into Brazil, leveraging on its
established existing network in the Latin American region. We expect
significant earnings contribution from this venture in 3-4 years.