Bosideng holds cautiously positive outlook
Bosideng International Holdings Limited, the largest down apparel company in the PRC, announces its final results for the year ended March 31, 2011.
For the year ended March 31, 2011, the Group recorded revenue of approximately RMB7,037.8 million (2010: approximately RMB5,738.1 million), representing an increase of 22.7% as compared with the corresponding period last year. The increase was mainly driven by the flexible pricing strategy of down apparel business to suit market needs and the continued expansion of non-down apparel business.
Gross profit increased by 14.3% to RMB 3,299.4 million (2010: RMB2,886.6 million). Profit attributable to equity holders of the Company increased by 18.3% to RMB1,276.4 million. The Board has recommended the payment of a final dividend of RMB6.8 cents and a special dividend of RMB6.0 cents (totalling RMB12.8 cents) per ordinary share for the year ended March 31, 2011.
Mr. Gao Dekang, Chairman and CEO of Bosideng, said, “During this financial year, the apparel industry was under the pressure of raw material and labor costs while sales and margins also declined. In response to the challenging market conditions, we changed our marketing strategy to promote our strong brand name and to introduce innovative products.
“We adopted a dynamic approach in the management of our supply chain to meet the changing market demands. In particular, the Group was able to meet the increased demand when winter weather came in October 2010. We promptly replenished the stock of popular items during the extended peak season from December 2010 onwards. As a result, the Group has achieved satisfactory results.”
The Group continues to enhance the diversity of its apparel products and proactively implemented a strategy to develop non-seasonal apparel products to expand its brand and product portfolio. Apart from the rapidly growing “Bosideng MAN”, we launched the luxurious business menswear brand “VETALLO” and acquired the casual wear brand “Mogao” and the kids wear brands during the reporting period, to fuel the growth of our non-down apparel business,” Mr. Gao continued.
During the year under review, branded down apparel business remained the largest revenue contributor, accounting for 80.7% of the Group?s total revenue. “Bosideng” branded apparel remained the highest contributor and contributed 62.6% or approximately RMB 3,554.2 million of the total branded down apparel sales.
“Snow Flying” branded apparel contributed 20.2% or approximately RMB1,146.2 million of the total branded down apparel sales. “Kangbo” and “Bengen” (previously known as “Bingjie”) recorded revenues of RMB572.5 million and RMB410.9 million, which represented 10.1% and 7.2% of the total branded down apparel sales respectively. In an effort to strengthen differentiation amongst various brands, the Group adjusted its product offerings under its portfolio of brands.
Going forward, Mr. Gao said: “The Group holds a cautiously positive outlook. The local consumption pattern and spending power will keep improving in the next one or two decades, and the development of apparel industry of the PRC is stepping towards a new era with a new focus on brand development and upgrading after the expansion of market scale. In the next three to five years, the Group will continue to increase the proportion of the non-down apparel business to overall sales and further expand international distribution channels and optimize the international sales network, so as to transform Bosideng into an international well-known integrated apparel brand operator.”