Q2 net income skyrockets 102% at Ever-Glory International
Ever-Glory International Group, Inc., a Chinese apparel exporter and retailer, said its sales climbed 44.9%, while net income skyrocketed 102.8% in the second quarter ended June 30, 2014, from an immense year-on-year growth in retail and wholesale revenues.
Total sales for the second quarter of 2014 stood at $85.7 million, up a huge 44.9% compared to $59.1 million in the second quarter of 2013. Ever-Glory attributed the massive growth to a 53.6% year-on-year rise in retail sales and 34.5% increase in wholesale revenues.
Retail sales in the second quarter of 2014 increased 53.6% to $49.3 million, up from $32.1 million in the same period of 2013. Ever-Glory said the increase was primarily due to opening of new stores and also from same store sales.
Ever-Glory, the first Chinese apparel company to be listed on the American Stock Exchange had 1055 retail stores as of June 30, 2014, compared to 831 retail stores as of June 30, 2013.
Wholesale sales surged 34.5% to $36.4 million in the second quarter of 2014, from $27.1 million in the prior year quarter. This increase it said was mainly attributable to increased sales in China, Germany, United Kingdom and United States.
Total gross profit for the second quarter of 2014 touched $29.3 million or 34.3% of total sales, compared to $19.5 million or 32.9% of total sales in the comparable quarter of last year.
Selling expenses for the quarter under review went up 45.5% to $14.4 million compared to $9.9 million in same quarter of last year. As a percentage of sales, selling expenses increased 10 basis points to 16.8% compared to 16.7% last year.
According to Ever-Glory, the increase was attributable to increase in average salaries, and also rise in number of stores, leading to increased numbers of retail employees, as well as the hike in store decoration and marketing expenses.
General and administrative expenses for the quarter shot up 36.8% to $7.5 million compared to $5.5 million last year, due to increase in payroll for additional management and design and marketing staff as a result of its business expansion.
As a percentage of total sales, general and administrative expenses decreased 50 basis points to 8.8% compared to 9.3% last year mainly coming from the increase in its sales.
Income from operations for the second quarter of 2014 again shot up by 82.1% to $7.4 million compared to $4.1 million in same period last year. Income from operations accounted for 8.6% of its total sales for the quarter of 2014, up 1.7% from 6.9% last year, as a result of increase in gross profit.
Net income for the quarter ending June 30, 2014 grew 102.8% to $5.5 million compared to $2.7 million in the quarter ending June 30, 2013.
Diluted earnings per share also doubled to $0.37 in the second quarter of 2014 from $0.18 in the three months ended June 30, 2013.
As of June 30, 2014, Ever-Glory had $25.0 million of cash and cash equivalents, down from $27.8 million as of December 31, 2013. It had working capital of around $38.8 million and outstanding bank loans of approximately $55.4 million as of June 30, 2014.
Fibre2fashion News Desk - India