The Blackmores Limited (ASX: BKL) share price climbed 4.3% in trade today after a steep decline yesterday on what looked a weak trading update for the quarter ending March 31 2019.
For the quarter Blackmores reported a profit fall of 14% to $44 million on revenue of $460 million, which was up 6% versus the prior corresponding nine-month period.
Blackmores' interim CEO Marcus Blackmores also flagged a plan to find $6o million in cost savings over the next three years in an attempt to boost the group's bottom line.
The shares are down 28% over the past year largely on the back of slowing sales growth in its key China market across the both direct-to-market and Daigou category where entrepreneurial Chinese shoppers buy in Australian before selling on in China at a mark-up.
While China sales have been softer it remains a huge potential growth market and it's being reported by some analysts that Blackmores may seek a Chinese joint venture partner to help accelerate sales in the region and negotiate the many regulatory obstacles.
So while Blackmores is down for now, it's not out, and a return to consistent growth in Chinese sales or joint venture partnership of sorts would improve sentiment on the business.
Other consumer-facing companies to consider with large exposure to China worth a look are the a2 Milk Company Ltd (ASX: A2M) and Treasury Wine Estates Ltd (ASX: TWE).
