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An Investor’s Quick Overview of How Vitasoy International Generates Its Income

Vitasoy International Holdings Ltd (SEHK: 345) is a food and beverage company, famous for its flagship Vitasoy-branded soy milk.

In this article, I’ll help investors understand one aspect of the company – how does it make its money? This will help investors get a quick overview of the company’s various sources of income so they better understand its business.

Segments

Source: Vitasoy 2019 Annual Report

From the above, we can see that Vitasoy categorises its business into four regions – Mainland China, Hong Kong Operation, Australia and New Zealand, and Singapore.

Let’s start with the biggest segment; Mainland China. This business mainly manufactures and sells various beverages such as soy milk, tea, juice and more across Mainland China. It represents up to 62% of Vitasoy’s 2019 total segmental profits (before head office costs and finance costs).

The next segment, Hong Kong Operation, is more diversified in term of its product offerings. In addition to beverage products like soy milk, tea, water, juice, this business segment also supplies tofu and operates tuck shops and catering businesses in Hong Kong, as well as exporting beverages to overseas markets.

Last but not least, we have the final two segments, namely Australia and New Zealand and Singapore. In the former, Vitasoy sells soy milk and other plant milk products in Australia and beverages in New Zealand. In the latter, it supplies various soy related products, both for Singapore and overseas markets.

Foolish takeaway

In all, Vitasoy is a rather diversified company with operations in many parts of the world. Thus, it is important that investors evaluate the company’s different business segments to better understand the attractiveness of the company as an investment.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Hong Kong contributor Lawrence Nga doesn’t own shares in any companies mentioned.