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Yue Yuen with revenue slowdown

Nov 18, 2021 Hong Kong
Yue Yuen with revenue slowdown
The group has announced results for the first nine months of 2021. Growth slowed down in the third quarter due to disruptions in manufacturing operations in Vietnam and weak retail sales
In the first nine months of 2021, which ended on the 30th of September, the group reported total revenue of 6.44 billion US dollars, reflecting an increase of 5.8% on a comparable basis to the same period of last year.

Revenue generated by the footwear manufacturing activity (including athletic/outdoor shoes, casual shoes and sport sandals) grew by 3.2% in the first nine months of the current year, totalling 3.30 billion US dollars, as compared to similar period in the prior year. In this period, it were shipped 179.0 million pairs of shoes, at the average price of 18.43 US dollars per price, with product remaining solid. However, the group declared that the recovery witnessed in the first half of 2021 was offset by recent lockdowns in Vietnam.

As for revenue from the manufacturing business (including footwear, as well as soles, components and others), Yue Yuen’ reported growth of 5.4% in the first nine months of 2021, reaching 3.66 billion US dollars, as compared to the same period of 2020.

In the same period, revenue attributed to the group’s retail subsidiary, Pou Sheng, was up by 6.3%, amounting to 2.79 billion US dollars, as compared to 2.62 billion Us dollars in the first nine months of last year. However, in local currency, revenue decreased by 1.7%, totalling 1.80 billion Chinese renminbi (around 2.8 billion US dollars). Yue Yuen’ credited this result to market dynamics and sporadic COVID-19 outbreaks in China in recent quarters.

In the first nine months of the current fiscal year, the group’s total gross profit increased by 24.2% to 1.56 billion US dollars, while the gross profit margin rose by 3.6% to 24.2%, on a comparable basis to similar period last year.


Full-Year Outlook

Yue Yuen has reported being gradually resuming production in Vietnam since the beginning of October in compliance with local safety criteria, so it is expecting to resume normal production levels in the coming months. However, it will continue to monitor closely the pandemic situation “in its key manufacturing regions while dynamically allocating its manufacturing capacity, where needed, to balance demand, its order pipeline, and labour supply”.


Image Credits: business-standard.com

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