Companies

Yue Yuen reports a decline in full year revenue and profit

Mar 20, 2024 Hong Kong

In line with its previous quarterly results, the Hong Kong-based footwear manufacturer reported a 12% year-over-year decline in revenue and a 7.3% year-over-year drop in profits in 2023

“Due to the weak performance of its manufacturing business”, driven by “soft global demand for footwear amid an industry-wide inventory digestion cycle”, Yue Yen’s full year revenue declined by 12.0% to 7.89 billion US dollars, on a comparable basis to the year 2022.

The footwear manufacturing activity segment (including athletic/outdoor shoes, casual shoes and sports sandals) contributed 4.66 billion US dollars to the company’s total revenue in 2023, down by 18.4% as compared to the previous year. This figure reflects a 19.9% decrease in the volume of pairs shipped, partially offset by a 2.0% increase in the average selling price and resilient demand for the group’s premium footwear.

Revenue generated by the manufacturing business as a whole (including footwear, as well as soles, components and others) totalled 5.06 billion US dollars, a decline of 18.4% on a comparable basis to the fiscal year 2022.

On the other hand, Pou Sheng’s revenue rose by 2.3% last year, as compared to the prior year, reaching 2.77 billion US dollars; in renminbi terms, its revenue increased by 7.7% year-over-year. Yue Yuen said that this “increase was mainly attributed to its focus on agility and sustained growth, backed by the resilient performance of its omnichannel, particularly its Pan-WeChat Ecosphere, as well as a low base effect”.

In the twelve months to the end of December 2023, the group’s “gross profit proved more resilient than its revenue”, highlights the statement, decreasing by 9.9% to 1.93 billion US dollars; accordingly, the overall gross profit margin improved by 0.6 percentage points to 24.4%.

In the year 2023, the profit attributable to the owners amounted to 274.7 million US dollars, a decrease of 7.3% on a comparable basis to the 296.3 million US dollars recorded in the previous fiscal year.

“In 2023, our manufacturing business demonstrated ongoing resilience by leveraging our core capabilities, with improvement in our gross profit margin and operating profit margin. I believe that with excellent operational foundations and convictions, the management team will together move forward with agility, amidst the new norm of an ever-changing macro environment, continuously safeguarding and boosting our sustainable growth”, commented Mr Lu Chin Chu, Chairman of the group.

Image Credits: Scott Graham on Unsplash

Hong Kong Footwear Manufacturing Results Shoes Year Results Yue Yuen