Yue Yuen reported that net income will surge in the range of 115 percent to 120 percent in the first half, to $83.6 million, attributable to a pickup in footwear manufacturing.
The Hong Kong-based firm said the increase was mainly attributable to strong demand for its footwear capacity, “driven by the gradual recovery of the global footwear industry, and further supported by a low base.”
In addition, the Group did not incur expenses for production capacity adjustments during the half when compared to one-off expenses of approximately $20.5 million for production capacity adjustments in the year-ago period. Profits were also boosted by a one-off gain of approximately $24.0 million “on the partial disposal of associates during the period.”
Yue Yuen said in its statement, “During the period, the group’s manufacturing business saw a decent recovery in its capacity utilization rate and footwear shipment volumes through its flexible production scheduling and orderly overtime arrangement. Alongside the ramp-up of new production capacity, combined with an increased utilization rate due to overtime hours in a number of factories, resulted in uneven production leveling across the manufacturing facilities. At the same time, the group’s sustained focus on cost-reduction and efficiency improvement initiatives, coupled with stringent expense controls and a low base effect, collectively supported solid growth in profit.”
Yue Yuen added, “The group will strengthen its operational resilience through its highly flexible and agile strategies, supported by a comprehensive plan to increase manufacturing manpower and capacity, in order to balance demand, its order pipeline and labor supply, thereby enhancing its efficiency and productivity.”
Full six-month results are scheduled to be reported on August 12.
