Sales drop 2.4% at Li & Fung in 2015

18 Mar '16
3 min read

In the year ended December 31, 2015, sales dropped 2.4 per cent year over year to US $18,831 million at Li & Fung, a leader in consumer goods design, development, sourcing and logistics.

“Of this, turnover in the trading business dipped 2.8 per cent, while the logistics business continued its high growth with revenue rising 6.7 per cent,” a press release from the Hong Kong based firm stated.

According to Li & Fung, operating costs were flat in the second half of the year, despite ongoing investments in infrastructure, logistics and vendor support services.

Core operating profit in the reporting year too decreased 15.2 per cent to US $512 million over the previous year, while profit attributable to shareholders also fell 4.6 per cent to US $421 million.

In the year under review, basic earnings per share were 39.1 HK cents or 5.04 US cents, down from 41.1 HK cents or 5.29 US cents in 2014.

“Excluding the results from discontinued operations in 2014, basic earnings per share would have decreased from 50.3 HK cents or 6.46 US cents to 39.1 HK cents or 5.04 US cents,” the company explained.

According to the company, it reported results which reflect the challenging macroeconomic environment and disruption at retail.

“Despite headwinds, including downward pressures from the deflationary environment and currency depreciation, we preserved top line growth with core trading customers and increased volume,” it added.

In 2015, the company reorganised to focus even more on core customers and product innovation in three initial areas of sweaters, furniture and beauty to help customers differentiate product offerings.

Group CEO Spencer Fung said, “2015 was a challenging year as our major markets in US, Europe and Asia all experienced strong headwinds.”

“However, our business foundation remains solid and our turnover was resilient and there was an increase in trading unit volume and continued growth with our core customers,” Fung too added.

“Our logistics business continued to be high-growth despite economic challenges across Asia and in the global freight market,” he observed.

Group chairman, William Fung too said, “Brands and retailers are challenged globally, to meet evolving consumer expectations against the backdrop of weak macroeconomic conditions.”

“Vendors and factories globally need help to increase speed to market, improve margins and produce unique products for changing and demanding consumers,” the chairman noted. (AR)

Fibre2Fashion News Desk – India

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