Yue Yuen's 2015 Revenues Expand 5 Percent

Yue Yuen reported revenues rose 5.3 percent to $8.43 billion in 2015, led by growth in its network of retail stores. Net pProfits grew 17.9 percent 

Highlights

Revenue up 5.3 percent to US$8.43 billion for the year ended December 31, 2015, compared to US$ 8.01 billion in the year ended December 31, 2014.
Recurring operating profit attributable to Owners of the Company declined 5.8 percent to US$405.5 million in 2015, compared to US$430.5 million in the same period last year.
    Non-recurring operating loss for the period amounted to US$15.3 million.
Total net profit attributable to Owners of the Company amounted to US$390.2 million in 2015, up 17.9 percentcompared to US$331.0 million in the same period last year.Total revenue of the Group rose 5.3 percent for the period to approximately US$8,434.9 million. Recurring operating profit amounted to US$405.5 million. The Group also had a net non-recurring operating loss of US$15.3 million for the period, of which included a combined impairment loss of US$ 22.2 million on amounts due and investment in joint ventures, on property, plant and equipment and on consideration receivable for disposal of properties. The non-recurring operating loss was partly offset by non-recurring operating gains, of which included US$ 5.1 million gain on fair value changes on consideration payable for acquisition of business and US$ 3.2 million gain on disposal of joint ventures.

The Board is pleased to propose a final dividend of HK$ 0.80 per share. Combined with the interim dividends declared earlier, the total dividends paid per share for fiscal year 2015 amounted to HK$ 1.20.

Revenue of athletic shoes were up by 3.8 percent and for casual/outdoor shoes down by 4.4 percent year over year respectively. Total shoe manufacturing volume was up by 3.4 percent to 317.5 million pairs for the twelve month period.

With regards to the retail and wholesale business of sportswear in the Greater China region, retail sales increased by 16.3 percent to US$2,298.2 million in 2015 compared to US$1,975.7 million recorded in the same period last year.

Gross Profit

During the period, the Group’s gross profit increased by 11.2 percent to US$1,972.3 million. When looking at the underlying business units, gross profit for the manufacturing operations involving international performance brands was stable for the year as increasing input costs including rising wages for workers, were partly offset by a reduction in material cost due to commodity price trends. Pou Sheng International (Holdings) Limited (“Pou Sheng”) had a gross profit improvement of 32.0 percent to US$766.1 million due to the stronger retail demand and the fewer discounting activities.

Selling & distribution expenses and Administrative expenses

For the Group, the sum of Selling & distribution expenses and Administrative expenses was up 13.8 percent compared to the same period last year. For the manufacturing operations, the sum of these items increased by 8.6 percent mainly due to an increase in personnel related expenses compared to the same period last year, whereas for Pou Sheng the sum of these items was up by 20.6 percent when compared with the same period last year due to the store network size increasing by 16.0 percent. Managements in both of the business units continue to explore methods of improving productivity.

Other expenses

For the Group, Other expenses declined by 30.5 percent compared to the same period last year. Most of this difference was due to the US$90.0 million provision accrued in 2014 for the increased contributions to the Employee Benefit Payments for employees of the Group's China factories.

Share of results from Associates and Joint Ventures (" Share of A&JV ”)

At the Group level, Share of A&JV increased by 4.8 percent to US$82.2 million. For the manufacturing operations, Share of A&JV was almost the same compared to the previous year. For Pou Sheng, share of loss from A&JV shrank further to a loss of US$1.3 million compared to a loss of US$4.3 million in the same period last year.