Home / Knowledge / News / Fashion / Effective cost control measures drive record profits in 2009 - Li & Fung
Effective cost control measures drive record profits in 2009 - Li & Fung
25
Mar '10
Hong Kong-based multinational Li & Fung Limited, the global consumer goods exporter, announced record profits for 2009, which was driven by its discipline in cost control amidst a soft consumer market.

For the year ended 31 December 2009, the Group's turnover was HK$104,479 million (US$13,395 million), 6% lower than the year before, reflecting sluggish markets, a number of customer insolvencies and the current tactic of many other customers to maintain tight inventory levels. At the same time, Li & Fung's core operating profit increased by 29% to HK$3,990 million,
largely due to the Group's cost-controlling efforts and
contributions from its higher-margin onshore businesses.

Profit attributable to shareholders reached HK$3,369 million, an increase of 39% compared to 2008. Results for both core operating profit and profit attributable to shareholders represented record highs. Basic earnings per share were 91.0 HK cents, an increase of 31% compared to 69.3 HK cents in 2008. The Board of Directors has proposed a final dividend of 49 HK cents per share (2008: 33 HK cents).

Mr. William K Fung, Group Managing Director of Li & Fung Limited, said, “We concluded the year with a strong performance in which we delivered not only operating leverage, but also a strong bottom-line. The Group's focus on operating leverage and cost control in the last 12-18 months has enabled us to drive greater profits despite a challenging consumer market. We are confident about 2010 and our ability to capture more market share in this environment.”

“During the year we also strengthened our sourcing capabilities in Europe, Middle East, Northern Africa, and the former Soviet Union republics through the opening of our new 7,100 sq. metre European hub operations in Istanbul, Turkey” said Mr. Fung. He added: “Our 80 offices around the world are now sourcing in more than 40 economies to ensure we deliver the most competitive solution to our customers.”

Mr. Bruce Rockowitz, President of Li & Fung (Trading) Limited, said, “We completed a number of landmark outsourcing deals in 2009, including Liz Claiborne Inc., Talbots, Inc. and Hudson's Bay Trading Company. We have also seen an increasing number of leading retail groups consolidating and aligning their global sourcing needs by partnering with us to leverage our scale and expertise.

“On the acquisition front, we made three roll-up acquisitions (JMI, Shubiz Ltd. and Clearskies Ltd.) and one large acquisition (Wear Me Apparel, LLC) in 2009. Now we are seeing this momentum carry into this year with the sourcing arrangement with Wal-Mart Stores, Inc. and the acquisition of Visage Group Ltd. in the first quarter. These deals will further solidify our market share in their respective areas and contribute positively to our bottom-line for years to come. Furthermore, the pipeline of deals remains very strong, and many of them focus on the high-potential health and beauty, footwear and European onshore businesses.”

Mr. Rockowitz continued, “This year is also the last year of the current Three- Year Plan 2008-2010. While our turnover target of US$20 billion and core operating profit target of US$1 billion seem challenging at present, we remain committed to them.”

Li & Fung Limited


Must ReadView All

Tajik textile-apparel exports rise 30% in Jan-Aug 2018

Textiles | On 16th Oct 2018

Tajik textile-apparel exports rise 30% in Jan-Aug 2018

Tajikistan’s production of textile and apparel rose by 30 per cent in ...

Courtesy: Good On You

Apparel/Garments | On 16th Oct 2018

Good On You aims to give consumers access to brand info

Australia based Good On You, an app that provides ratings of over...

Courtesy: Rieter

Textiles | On 16th Oct 2018

Rieter launches new ring and compact spinning machines

Rieter has launched G 37 and G 38, the new ring spinning machines,...

Interviews View All

Sonia Agarwal, Whitenife

Sonia Agarwal
Whitenife

‘The terms eco-friendly and organic are common but everyone perceives them ...

Dharmendra Shah, Ozone PB Spintex Limited

Dharmendra Shah
Ozone PB Spintex Limited

‘We have made huge investments to ensure quality yarn production.’

Sunil Rathore, Lacoste India

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Manoj Sorathiya,

Manoj Sorathiya

Surat-based Sunrise Imports & Exports Co is a manufacturer and...

Carolin Russ,

Carolin Russ

Weko, Weitmann & Konrad GmbH & Co KG, based in south Germany, is...

Maya Simova,

Maya Simova

Inter Expo and Congress Center (IEC) is a prominent exhibition centre in...

Melissa Tate, University of New South Wales

Melissa Tate
University of New South Wales

<div><div><div><div><b>Melissa Tate</b>, a well-known scientist currently...

Mr Ambrose Chan, DSG International (Thailand) PLC

Mr Ambrose Chan
DSG International (Thailand) PLC

Paolo Ocleppo, Sandvik Hyperion

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Rajesh Pratap Singh, Rajesh Pratap Singh

Rajesh Pratap Singh
Rajesh Pratap Singh

<div>Ace fashion designer <b>Rajesh Pratap Singh</b> has used Tencel to...

Karan Arora, Karan Arora

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Sanjukta Dutta, Sanjukta's Studio

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


October 2018

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

news category


Related Categories:

Advanced Search