PRESS RELEASE
| Investor Relations Contacts: | |
| Philip Huang | Pamela Leung |
| Yue Yuen Industrial (Holdings) Limited | Thomson Financial/Carson |
| Tel: (852) 2370-6438 | Tel: (852) 2905 3183 |
| Fax: (852) 2370-3547 | Fax: (852) 2140 6423 |
| Email: Philip_Huang@yueyuen.com | Email: pamela.leung@tfn.com.hk |
Hong Kong, 17 April 2001 - Yue Yuen Industrial (Holdings) Limited ("the Group"; SEHK: 551) today announced its unaudited consolidated results for the three months ended 31st December, 2000. The unaudited net profit of Yue Yuen during the period was approximately US$50.4 million, a drop of 9.2 % compared to the same period in 1999, while operating profit registered a slower decline of 4.8 % to US$55.7 million.
Turnover rose by 7.9% to approximately US$435.1 million, compared to the previous corresponding period, bolstered by fast-growing sales to the European market, increasing orders from certain existing brand customers, additional orders from new brands and revenue contribution from the new joint-venture in Indonesia.
During the three-month period, sales to Europe saw a 23.8% jump to US$142.8 million. The slice of European market has grown to 32.8%, up from 28.6%, of total sales, demonstrating the continuing trend of decreasing reliance on the US market. During the quarter, sales to the US accounted for 47.4% of total revenue, down from 52.5% for the same period last year.
Sales of athletic footwear grew by 9.5% to 23 million pairs, while casual footwear sales recorded an increase of 16.9% to 4.5 million pairs.
"We are pleased to have recorded stable sales growth during the period, amid current slowing US economy." said Mr Tsai Chi Neng, Chairman of Yue Yuen.
He pointed out that several newly set-up operations, which brought additional revenue to the company, have yet to reach the optimal operating efficiency level, resulting in a lower profit margin during the period. Stripping out the effect of these new operations, operating efficiency was maintained at a similar level during the period under review.
In addition, increase in minimum wage in China early last year lifted labour costs, also put pressure on profit margin.
"Looking forward, management is confident that the Group will continue to register stable growth in turnover, and we believe the operating efficiency and profit margin of new operations will gradually improve, aided by stabilizing costs." Mr Tsai said.
Yue Yuen Industrial (Holdings) Limited (SEHK stock code: 551) is the largest branded footwear manufacturer in the world, with a 14% market share in all of branded athletic and casual footwear. The Group is an original equipment manufacturer / original design manufacturer ("OEM / ODM") for major international name brand companies such as Nike, Adidas, Reebok, Timberland and Rockport. Yue Yuen also produces footwear components for sale to branded footwear companies and other manufacturers.
In 1988 Yue Yuen was incorporated by the Tsai Family and has been listed on The Stock Exchange of Hong Kong Limited since 1992.
Unaudited Consolidated Results
For the three months ended 31st December, 2000
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