In a business update, Stella International said revenues for the first quarter increased by 15.3 percent to $303.4 million. This is mainly due to a favorable comparison base with last year’s first quarter, when the Chinese company’s revenues were affected by store and factory closures, as well as lower demand due to the Covid-19 pandemic.
This quarter, footwear manufacturing revenues advanced by 16.8 percent to $299.8 million, including a 9.1 percent increase in the number of pairs to 12.0 million. The average selling price rose by 7.3 percent to $25.00, driven by changes in its product mix and customer mix.
Steady volume growth and margin improvement will be its main priorities in 2021. It expects its product mix, which was more heavily weighted towards the Sports category during 2020, will start to normalize as the Fashion, Luxury and Casual categories rebound. One of the priorities this year will include expanding its manufacturing facility dedicated to sports footwear in Vietnam. It will also continue to work with customers who are expanding into new categories such as athleisure.
Stella is cautiously optimistic for the summer season, but it will depend on the progress of vaccination programs around the world. This year’s quarterly comparisons will also be impacted by inventory built up during the pandemic.
As of March 31, 2021, the company’s financial position remained solid with cash on hand and total undrawn bank facilities of about $270 million.