Yuhua Yuan, The Largest Sports Shoe Manufacturer, Gained 5.3% Revenue Last Year.

Learn, global

Yuyuan Industrial revenue increased 5.3% last year, net profit increased by 17.9% annually.

Yucheng yuan, a subsidiary of Baocheng group, increased its net profit by 17.9% in the 2015 fiscal year, and the total revenue of Yuyuan group totaled US $8 billion 434 million 500 thousand for the year. Manufacturing revenue rose 1.6% to US $6 billion 136 million 700 thousand.

Taiwan Baocheng group's subsidiary Yuyuan Industrial (Holdings) Holdings Limited increased its net profit in the 2015 fiscal year by 17.9%, from $331 million in fiscal 2014 to $390 million 200 thousand.

Yuyuan group's total revenue for the year amounted to $8 billion 434 million 500 thousand, compared with $8 billion 13 million 400 thousand the previous year.

Manufacturing revenues rose 1.6% to $6 billion 136 million 700 thousand, mainly driven by a 3.4% increase in output, while retail sales rose sharply from 16.3% to $2 billion 298 million 200 thousand.

Yuyuan group

It is managed by Baosheng International (Holdings) Limited, a listed Affiliated Companies. It is the largest distributor of AdidasAG Adidas group, the world's second largest sporting goods manufacturer in mainland China.

The largest category of sneakers in manufacturing business was $4 billion 15 million 900 thousand, an increase of 3.8% over the previous year; casual shoes / outdoor shoes fell 4.4% to 1 billion 365 million 900 thousand dollars; sports sandals increased from 10.9% to 94 million 400 thousand dollars; soles, accessories and other items increased slightly by 1.1% to 660 million 500 thousand dollars.

The total output of shoes was 317 million 500 thousand pairs, and the average selling price decreased by 1.6% to 17.25 dollars compared with that of the previous year, 17.53 dollars in the previous year.

China accounted for only 25% of Yuyuan group's footwear output last year, down 4 percentage points from 2014, Vietnam's share rose from 39% to 42%, and Indonesia's 32% share remained stable, accounting for 1% in Burma and other places.

In its earnings report, the group said it would still prioritize and optimize production capacity among different countries this year, and continue to expand its capacity in Vietnam, Indonesia and Burma.

At the end of 2015, BankofAmericaMerrillLynch, Merrill Lynch and Merrill Lynch predicted that the continued pfer of capacity would continue to suppress the profitability of OEM business, which would last until the end of 2016.

In April last year, Yuyuan group's Dongguan Gao Gao factory staff went on strike because of social security funds and other issues. AdidasAG Adidas group therefore pferred part of the order.

AdidasAG, general manager of Adidas Group China, revealed at the beginning of this month that ColinCurrie will continue to retain China's capacity.

China is the largest purchasing market of the group. According to the annual report released by the group last week, the brands of 29%Adidas, Adidas, Reebok, Reebok, TaylorMade-Golf and Ashworth brands were "made in China", the proportion decreased by 2 percentage points compared with that in 2014, while the output of Kampuchea and Vietnam increased by 3 percentage points, respectively, 19% and 16% respectively.

The two customers, who accounted for more than 10% of Yuyuan group's revenues, brought in 1 billion 683 million 400 thousand US dollars and 1 billion 394 million 500 thousand US dollars respectively, while the former recorded a 0.8% decline, while the latter had a 11.5% increase.

In terms of source of revenue, revenue from us customers decreased by 3.9% to US $2 billion 124 million 100 thousand over the same period, accounting for 1/4 of total revenue. European customer revenue rose by 9.6% to US $1 billion 641 million 500 thousand, while revenue from Chinese customers contributed US $2 billion 913 million 200 thousand, a 12.9% increase.

Commodity prices

The cost of downward promotion materials has been offset by the rise in the cost of manufacturing, which is mainly caused by the increase in employees' salaries (from 10% to 1 billion 100 million US dollars), and the gross margin of manufacturing business is relatively stable.

The retail business benefited from the increase in retail demand for sporting goods and the reduction in discount activities, driving the gross profit margin of the whole year to rise by 125 basis points, to 23.38%.