Select Page

Hi Henry, 
If it is rising ahead of the revenue, say revenue grew 10% but expenses grew 30%, it is definitely a concern. By then, it is a sign that the profitability margin has significantly reduced. If that’s happening, it is always good to check out the actual reason and not written off the investment right away.
Hartalega sales grown at that time when we invested but still lagging behind the expenses growth and the primary reason we found out was due to the early commitment (i.e. hiring man power in advance and train them for few months) to kick start the production. We classify it as temporary poor margin and it should recover as soon as the new plant starts to contribute sales.