Stock Digest - Nova Wellness Group Bhd - Declined Sales Order And Increased Expenses Dragged Margin

YoY, core net profit fell 39.8% YoY to RM2.9m, primarily resulted from (i) a decrease in revenue from House Brand segment as compared to the higher revenue from the OEM segment, and (ii) higher cost of sales, admin costs (employee bonus and benefits) and other operating expenses (higher R&D costs) despite the decrease in selling and distribution expenses due to lower salesman commission expenses in tandem with the decline in revenue. Overall, core net profit margin shrank from 40.7% to 26.6% YoY.