Stella International Holdings Limited, a developer, manufacturer and retailer of footwear and leather goods, reported that first-quarter revenues decreased 25.8 percent to approximately $284.6 million, compared to revenue of about $383.3 million for the comparable 2022 period.

Shipment volumes in the three months ended March 31 decreased 31.4 percent year-over-year due to “a high base effect with the Group’s manufacturing business running at a full utilization rate during the year-ago period, and with certain Sports and Casual customers clearing their excess inventory during the first quarter of 2023.”

Average selling prices increased by 7.5 percent year-on-year due to changes in the Group’s product and customer mix.

The Group’s unaudited consolidated profit after tax is in line with the company’s expectations and indicates that it remains confident in reaching the medium-term goals of its Three-Year Plan (2023 to 2025), achieving an operating margin of 10 percent and low-teens annualized growth rate on profit after tax by the end of 2025.

Chi Lo-Jen, CEO of the Group, said, “While the revenue in the first three months of 2023 decreased, our profit after tax was in line with our expectations due to better customer mix and operational efficiencies. We expect our order book in the first half of the year to be impacted as some of our major customers deal with inventory challenges. That said, the removal of COVID-19 restrictions in China from late 2022 may lead these customers to increase their ordering activity in the second half of the year.”

Lawrence Chen, chairman of the Group, said, “Our three-year growth and margin expansion plan remains on track as our new Luxury and high-end Fashion customers continue to grow their orders. We remain optimistic about our long-term prospects.”