Global Apparel Market – An Overview | Watch NOW! | Ad
Home / Knowledge / News / Fashion / FUQI gross margin fall in Q4 2007
FUQI gross margin fall in Q4 2007
Feb '08
FUQI International Inc announced selected financial results for the fourth quarter of 2007.

For the fourth quarter of 2007, the Company expects revenues of between $54 million and $55 million and net income of between $6.9 million and $7.2 million.

The Company also expects the gross profit margin and net profit margin will be approximately 10.5% and 13.1%, respectively.

The results of operations for the fourth quarter of 2007 include a one-time reversal of a tax penalty of approximately $4.2 million and equity-based compensation expense of approximately $900,000.

Revenues for the fourth quarter are expected to be between $54-55 million, which represents a year-over-year increase of more than 117%.

Revenues were higher than expectations, driven by a sales event hosted by the Company in December, which generated not only significant sales for the Chinese New Year, but also repeat sales in the remainder of the quarter.

Additionally, Fuqi's brand name is becoming increasingly visible, especially following its listing on the NASDAQ Global Market, which is helping to drive sales.

Gross margin in the fourth quarter was 10.5%, down from third quarter gross margin of 12.4%, and below management expectations of 11.5-12%. The lower than expected gross margin is primarily attributable to higher inventory costs during the quarter.

As a result of increased demand, the Company replenished its lower-cost inventoryin November in preparation for its December sales event. Raw materials prices in both November and December were higher than the inventory that had already been used in the quarter.

The Company accounts for inventory using the FIFO (first in, first out) method, and this accounting impacted gross margin by approximately 105 basis points.

The Company's higher than expected revenues during the quarter, combined with ongoing efficiencies in its operating structure, led to net income margin of approximately 13.1%, resulting in 4Q07 diluted EPS estimate of $0.36-$0.38, based on a weighted average diluted share count of 19 million shares.

Must ReadView All

China reportedly cancels trade talks with US, Liu He visit

Apparel/Garments | On 22nd Sep 2018

China reportedly cancels trade talks with US, Liu He visit

Washington is reportedly positive about arriving at a solution to its ...

AmCham Cambodia cautions US against possible sanctions

Apparel/Garments | On 22nd Sep 2018

AmCham Cambodia cautions US against possible sanctions

In a letter to US lawmakers, the American Chamber of Commerce...

Courtesy: ycloset

Apparel/Garments | On 22nd Sep 2018

Alibaba invests in clothes sharing platform Ycloset

Chinese garment sharing platform YCloset has completed an undisclosed ...

Interviews View All

Amrit Sethia, SOIE

Amrit Sethia

‘The intimatewear category in India is slowly becoming trend-sensitive.’

Claudia Kersten, Global Organic Textile Standard

Claudia Kersten
Global Organic Textile Standard

‘GOTS is a very efficient supply chain management tool, especially for...

Amardeep Singh, Orient Craft

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Anupam Arya,

Anupam Arya

<div>Jaipur-based Fabriclore Retailing Pvt. Ltd. is attempting to revive...

Tejas N Patel, Navin D Patel,

Tejas N Patel, Navin D Patel

Founded in 1999 by Navin Patel in the name of Tejas Fabrics with 100...

Erik Sy,

Erik Sy

Manila-based CustomThread is a start-up offering premium custom apparel...

Mr Ambrose Chan, DSG International (Thailand) PLC

Mr Ambrose Chan
DSG International (Thailand) PLC

Giorgio Mantovani, Corman S.p.A

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Isabel Herranz, European School of Business & innovation

Isabel Herranz
European School of Business & innovation

Cutting-edge ideas like the Internet of Things and artificial intelligence ...

Madhu Jain, Madhu Jain

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Samar Firdos, Arvind Ltd

Samar Firdos
Arvind Ltd

<b>Samar Firdos</b>, Chief Manager (Design) at Lifestyle Apparel Denim...

Nisha Chanda, Whistling Woods International School of Fashion

Nisha Chanda
Whistling Woods International School of Fashion

<div>A lack of upgraded courses in costume designing and fashion as per...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on

Letter To Editor

(Max. 8000 char.)

Search Companies


Leave your Comments

September 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category

Related Categories:

Advanced Search