Ever-Glory International Group, Inc. (EVK), an apparel supply chain manager and retailer based in China, announced today its financial results for the period ending December 31, 2008.
Having achieved net sales of $70.3 million in 2007, Ever-Glory was able to increase net sales 38.6% to $97.5 million for 2008. A portion of the growth in net sales was due to the introduction of a new retail product â€œLA GO GOâ€. The other major component of the change in net sales was due to the broadening of Ever-Gloryâ€™s wholesale business to customers in Japan, Europe, the U.S., and the Peopleâ€™s Republic of China (PRC).
Ever-Glory recognized a GAAP net income of $3.6 million, or $0.26 per diluted share, for the fiscal year 2008. The reported GAAP net income included $2.3 million, $0.17 per diluted share, of non-cash expenses due to amortization issuance costs and discounts related to convertible notes. When the non-cash expenses are excluded, the non-GAAP diluted earnings increase to $0.43 per share for 2008.
â€œOur 2008 performance reflected the notable progress we are making in both our wholesale and retail apparel operations. In our wholesale business, we remain focused on mid-to-high end apparel casual wear, outerwear and sportswear production. Sales in 2008 increased in all of our key geographic areas as we enjoyed new orders from both new and existing customers. Our wholesale business remains dedicated to delivering quality products while remaining ahead of the competition in product development and overall innovation. We are also very pleased with our retail strategy and the roll out of our LA GO GO stores. During 2008, we opened 93 LA GO GO stores, each store generating average revenue of approximately $8,500 per month. We believe that LA GO GO will become more meaningful to our revenue and add to our profitability in the coming years,â€ stated Edward Yihua Kang, CEO and Chairman of Ever-Glory.
Kang understands that the global economic environment will effect the expected growth of the company in 2009. The company plans to move forward with expansion into the wholesale and retail business sectors, but will remain flexible on wholesale pricing due to changes in the global economy.
Ever-Glory estimates net sales results of $20 to $25 million in the first quarter of 2009 compared to $19.7 million for the same period in 2008. The company anticipates net income for the first quarter of 2009 of between $1.0 and $1.2 million, which is in line with 2008 results of $1.2 million. Ever-Glory estimates total net sales of $120 to $135 million and net income of $5.8 to $6.5 million for the entire fiscal year 2009. Additionally, the company forecasts retail revenue of $10 to $15 million and wholesale revenue of $120 million for 2009.
â€œWe are working diligently to establish LA GO GO as a premier mid-end mass market brand for women. Seven new LA GO GO stores have been opened this year and we believe a total of 80-100 stores can be opened in 2009. Our goal is to increase our per-store revenue average on a monthly basis and to establish positive same store sales trends. We have a compelling opportunity to expand our wholesale business portfolio into higher class brands and expand our global customer base. Our core strengths will allow us to expand our competitive position in the marketplace,â€ concluded Kang.
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