Besunyen Holdings (HKG:0926) has published a profit warning stating that compared to the information currently available with the results of the group for the year ended 31 December 2010, the turnover of the group for the year ended 31 December 2011 is expected to decrease marginally and its net profit for the same period to decrease significantly or turn into a marginal net loss. The company expects to release the annual results for the year ended 31 December 2011 in March 2012.

The above changes are mainly attributable to the following reasons: (i) the overall macro-economy of the PRC has been slowing down since the second half of 2011 and this caused the reduction in demand for the group's products from distributors; (ii) the sales of existing products in new markets and through new sales channels were not as good as expected; (iii) although trial launch of the new product, Mei An Granules, has achieved certain progress, the schedule for an official launch has lagged behind; and (iv) notwithstanding the above, for the purpose of long-term brand building, the group did not substantially adjust the incurrence of advertising and selling expenses in the second half of 2011.

Besunyen said that in 2012, while continuing to reinforce its market share and growth in tier-1 cities of the PRC, the group shall enhance the penetration into new markets in tier-2 and tier-3 cities of the PRC and the intensification of new sales channels (including, but not limited to, e-commerce, supermarkets and convenience stores), in order to maintain good development pace of current products. In addition, the group shall procure the official launch of the two new products, Mei An Granules and MaiShuPing, in order to bring new sales contribution to the group. On the other hand, the group shall also optimise the structure of advertising and selling expenses and tightly control expense-to-turnover ratio.