Chinese Retailer Ever-Glory’s Q3 Sales Grow 28%
Ever-Glory International Group (AMEX:EVK), an apparel retailer in China, posted strong sales growth for the third quarter but its benefits were offset by higher expenses.
Total sales for the third quarter increased to $31.9 million from
$24.9 million in the third quarter of 2009 due to strong wholesale and
retail sales.
Wholesale sales increased by almost 15% year-over-year to $25.6
million while sales from the company’s La Go Go clothing stores more
than doubled to $6.3 million.
The company currently has 250 La Go Go stores, up from 214 stores
at the end of the third quarter. The company said it will open 30 to
40 additional stores before year-end.
Despite the strong sales growth, an 80% year-over-year increase in operating expenses kept profit growth at bay.
For
the third quarter, profits attributable to the company increased by
roughly 2% year-over-year to $1.83 million, which includes a $0.62
million of non-cash gain related to the company’s derivative
liabilities. Earnings per share were 12 cents.
At quarter end, Ever-Glory had about $22.5 million of working
capital, $3 million of which was cash. Outstanding bank loans totalled
$13.1 million.
For fiscal 2010, the company forecasts it will have a profit in
the range of $5.5 million to $6.5 million. Revenue for the fiscal year
is expected to be between $121 million and $141 million.
Since the announcement, the company’s shares have rallied almost 14% to trade at $2.37 as of 12:26 pm ET.
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