SINGAPORE : Mainboard-listed Eu Yan Sang International has booked a 75 percent drop in third-quarter earnings to S$1.3 million.

The decline was mainly due to an impairment charge from the restructuring of its spa business, as well as foreign exchange losses.

Revenue for the three months ended March rose 12 percent on-year to S$61.4 million.

Eu Yan Sang said it saw healthy sales in its key markets Hong Kong, Malaysia and Singapore.

And going forward, the group plans to expand its footprint in China.

The Red White & Pure business has been a drag to Eu Yan Sang since its launch in 2006.

But according to the group, there is a silver lining ahead.

Richard Eu, Group CEO, Eu Yan Sang International, said, "The strategy has been to remove those parts of the business that have been loss-making. In particular, we've closed the clinic business in Australia. And now we've restructured the Red, White & Pure business in Singapore."

The restructuring charge for Red, White & Pure cost the company S$2.9 million, dragging down its third-quarter earnings.

Eu Yan Sang now holds only 20 percent ownership of the spa and restaurant business in Singapore.

Overall, the group said sales continued to grow.

For the third quarter, the retail segment saw a 14 percent rise in revenue over a year ago to S$49.3 million, while the wholesale business also grew by 20 percent to S$8.3 million.

And Eu Yan Sang has increased capacity with 17 new stores within the past nine months.

Going forward, it plans to focus on expanding its footprint in China.

Mr Eu said, "Last year we opened shops in Macau, Taiwan and Guangzhou and we will be opening more outlets in China. We're in the process of putting together a team now for China."

The group said it is opening more than two shops in China over the next 12 months.

Currently, Eu Yan Sang has 142 stores in the region. - CNA/ms