Li & Fung Ltd. said its 2010 net profit rose 27%, helped by its rapid expansion in the U.S. and Europe. Net profit for its year ended Dec. 31 rose to 4.28 billion Hong Kong dollars (US$549.4 million) from HK$3.37 billion in 2009.
The result was lower than the HK$5.03 billion estimate from 13 analysts surveyed by Thomson Reuters. Revenue rose 19% to HK$124.12 billion from HK$104.48 billion.
The company's core operating profit rose 42% to HK$5.66 billion (US$726.6 million) from HK$3.99 billion, falling short of the US$1 billion target set under its three-year plan for 2008-2010. Li & Fung sets successive three-year plans to guide its expansion and growth strategy.
Li & Fung also set a three-year plan for 2011-2013, and said the company aims for its core operating profit to rise to US$1.5 billion in 2013. The goals are 50% higher than the $1 billion in the
previous three-year plan.
“We expect that the European onshore business will track the
development pattern of U.S. onshore business very closely and
actively grow via acquisition during this plan period,” the
company said in a filing to the Hong Kong stock exchange.
Li & Fung president Bruce Rockowitz also reiterated that the company is still pursuing acquisitions.
The Hong Kong-based company, which sources products for U.S. retailers such as Wal-Mart Stores Inc., Abercrombie & Fitch Co. and Kohl's Corp., declared a final dividend of 52 Hong Kong cents (six U.S. cents) a share, up from 49 Hong Kong cents in the previous year,