The sales of the Hong-Kong-based footwear group Stella International rose by 58.1 percent to $392.1 million in the second quarter from $248.0 million a year earlier, when sales were negatively impacted by the outbreak of the Covid-19 pandemic. Top line growth was also underpinned by a recovery in orders in 2021.
Revenues from manufacturing increased to $383.9 million in the quarter from $247.8 million a year earlier and shipments grew by 54.3 percent to 14.5 million pairs from 9.4 million. The average selling price increased slightly to $26.5 a pair from $26.4.
In the six months to June 30, overall sales jumped by 36.1 percent $695.5 million, with revenues from manufacturing rising to $683.7 million from $504.5 million the previous year. Shipments grew by 29.9 percent to 26.5 million pairs from 20.4 million and the average selling price grew to $25.8 from $24.7. Thanks to revenue growth, Stella anticipates to post a net profit of at least $30 million in the first half of 2021 compared with a net loss of $5.2 million a year earlier.
The company is “cautiously optimistic” about orders in the second half of the year and expects the pace of volume and revenue recovery to moderate due to a stronger comparision base. However, it warned about recent lockdowns in many parts of Asia and the continued risk posed by the Covid-19 pandemic.
Stella indicated that it continues to prioritize margin improvement by upgrading its product mix and attracting “high-quality” customers. It will also focus on steady volume growth, risk management and cash flow generation in order to safeguard a “strong” financial position. The group stressed that it is “making good progress” in expanding its production capacity in Southeast Asia.