Yue Yuen Industrial Holdings Limited turnover and net profit for the third quarter of fiscal year 2004
rose 15.5% year on year to $768.0 million and 6.6% to $93.2 million respectively.
For the nine-month period ended 30 June, 2004, the total turnover and net profit increased by 6.3% to
US$2,026.4 million and 5.2% to US$251.5 million respectively compared with the corresponding
period last year. Total shoe production during the period amounted to 125.9 million pairs, an increase
of 3.8% compared with the same period last year.
The Groups turnover growth gathered momentum in the third quarter mainly due to a pick up in its
core footwear manufacturing business. The average selling price (ASP) recorded a positive year on
year growth in the third quarter, reflecting the increase in raw material costs and the change in
product mix. The Groups gross margin stabilized despite the fluctuation in raw material prices. The
China retail operation recorded a 213% year on year growth to US$49.5 million for the nine months
ended 30th June, 2004.
During the period under review, the Group continued its horizontal diversification by making two
strategic investments. Firstly, the Group formed a joint venture called Yuen Thai Industrial Co.
Limited, which is engaged in the manufacturing of sports apparel, with Luen Thai Holdings Limited
(Luen Thai) and also took a 9.9% stake in Luen Thai. Secondly, the Group acquired a 30% stake in
Prosperous Industrial (Holdings) Limited, an OEM/ODM for sports bags, backpacks and luggage.
