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Higher shipment volumes support Stella’s performance

Sep 14, 2015 / Hong Kong
Higher shipment volumes support Stella’s performance
The footwear giant announced revenue and profit rising by 10.4% and 2.7%, respectively, in the first half of 2015. Sustained demand and greater capacity utilisation to support performance in second half
Stella International Holdings Limited, a leading developer, manufacturer and retailer of footwear and leather goods products, announced its unaudited interim results for the six months period ended on the 30th of June 2015.

The group’s consolidated revenue for the period rose by 10.4% to 798.1 million US dollars, as a number of its US and European customers started to restock inventories. Shipment volumes rose by 12.2% to 26.6 million pairs, compared to 23.7 million pairs in similar period last year.

Mr. Lawrence Chen, Chief Executive Officer of the Group stated: “Sustained economic growth and stabilisation in our two primary export markets boosted shipments and revenue as customers restocked and expanded their operations. This trend should also translate into more orders in the second half of the year, with volumes also likely to be supported by greater capacity utilisation at our manufacturing facilities.”

During the six months under review, women’s fashion footwear continued to be the biggest contributor to overall revenue, at around 35% of total revenue. The contribution from the women’s and men’s casual footwear segments was 26% and 23%, respectively, while the men’s fashion footwear segment contributed around 10% of overall revenue.

Geographically, North America and Europe remained the group’s two largest markets, accounting for 50.1% and 27.5% of the group’s total revenue, respectively. This was followed by the PRC (including Hong Kong) accounting for 13.8%, Asia (other than the PRC) accounting for 5.5% and other geographic regions, which accounted for 3.1%

Revenue from the retail business fell by 14.8% to 44.2 million US dollars during the six months under review, compared to the previous corresponding period. Same-stores sales (in China only) fell 15.6% to 32.9 million US dollars during the period under review.

As of the 30th of June  Stella operated a total 212 Stella Luna stores, 110 What For stores, 9 JKJY by Stella stores and 2 Pierre Balmain stores globally.

The group believes that improved quality and efficiency of standards at the manufacturing facilities in inland China and South-East Asia led to increasing utilisation of the capacity at these locations during the first half of the year. This is a result of the group's ongoing strategy to diversify and optimise its manufacturing base away from coastal China in order to better control labour costs and labour supply.

Regarding forecasts for the second half of the year, in addition to higher demand, orders in the second half of 2015 should also be supported by better efficiency and improved utilisation at the manufacturing facilities in inland China and South-East Asia.

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