There are a lot of inquiries from companies who are interested to represent and becoming an official distributor there

by SHAZNI ONG/ pic by RAZAK GHAZALI

SPRITZER Bhd is looking to penetrate into the US market as part of the bottled water company’s move to expand its international business segment.

Spritzer Research and Development director Dr Chuah Chaw Teo (picture) said there is potential for Spitzer to establish a presence in the US as there are a lot of inquiries from companies who are interested to represent and becoming an official distributor of Spritzer there.

“Apart from the countries that we have established a presence in, we are also trying to penetrate the US now. There are a lot of requirements (to be sorted out). We have (to) put in our application for approval from the relevant US authority bodies such as the US Food and Drug Administration (FDA),” he told The Malaysian Reserve in an interview in Shah Alam, Selangor, yesterday.

Spritzer is hoping to submit its application to the FDA by the end of this year. Chuah said the company aims to use California as its doorway into the US market if successful with its application.

Chuah added the right representative will be chosen once the necessary approvals have been received.

“The requirements there are stringent. We are working on that which includes getting experts to certify tests,” he said.

Spritzer now has a presence in Hong Kong, the UK, the Netherlands, Brunei Darussalam, Singapore, Pakistan, Sri Lanka, Thailand and Australia.

Spritzer’s international market shares currently account for about 10% of total annual revenue and hopes to increase it to 15% in the years to come.

“We are concentrating a lot to boost up our market (presence) in China. Our presence in the UK is still small, but we are hoping to help our representative there using e-commerce to capture more market,” Chuah said.

Spritzer is seeking to improve its promotions and marketing in the UK and gotten its representative in the Netherlands to back the UK representative to help grow the business.

“For Pakistan, we have an agent who is already helping Gloria Jeans Coffee there, and using that platform to promote us (Spritzer),” Chuah said.

Spritzer has a 40% share of the bottled water market in Malaysia while exports account for about 10% of total revenue now.

Chuah expects the Spritzer to post positive results in its upcoming second-quarter (2Q19) results, expected to be announced by the end of the month, on the back of increase in sales as a result of the heatwave affecting the country since March this year.

Kenanga Research in a research note dated June 12, said it gathered the group managed to see relatively better sales volume the past fasting month.

“This prompted us to believe steady sales growth may be sustainable going forward, bolstered by the sturdy consumer sentiment seen in spite of the imposition of sales tax in January 2019, coupled with the group’s effective marketing strategies which have continued to capture local market share,” the research firm said.

For its 1Q19 ended March 31, Spritzer recorded a 13.7% year-on-year (YoY) increase in net profit to RM7.71 million due to the increase in sales volume of bottled water coupled with the reduction in raw materials and packaging material costs.

Spritzer’s revenue for the period grew 15.2% YoY to RM95.09 million on increase in sales volume of bottled water as customers increased stock holdings in anticipation of the increase in consumer demand during the Chinese New Year festive period in the quarter.

Spritzer closed 0.43% or one sen lower at RM2.29 yesterday, giving it a market valuation of RM480.88 million.