Sat, Feb 08, 2014 - Page 14 News List

Makalot sales to grow 20%

APPAREL SHIPMENTS:Global fashion brand supplier Makalot Industrial Co expects revenue increases on the back of rising order numbers from Japan and the US

By Camaron Kao  /  Staff reporter

Makalot Industrial Co (聚陽實業), a supplier for global fashion brands such as Uniqlo and Gap Inc, said yesterday that shipments would grow 20 percent this quarter from a year ago as Japanese and US clients increase orders.

The company expects to sell 3.24 million dozen of apparel this quarter, up from 2.7 million dozen a year ago, a Makalot official, who declined to be named, said by telephone yesterday.

The official said that the average selling price of the company would also post single-digit percentage growth from a year ago, but the official did not offer an exact number.

Makalot yesterday reported revenue of NT$1.72 billion (US$56.8 million) last month, up 33.33 percent from NT$1.29 billion last month and 14.5 percent from NT$1.5 billion a year ago, according to the company’s filing to the Taiwan Stock Exchange.

“The month-on-month revenue increase was because our clients tend to postpone orders to the beginning of a year to avoid creating high inventory levels on their balance sheets when they settle their accounts at the end of every year,” the official said.

The official added that the year-on-year revenue increase was caused by rising orders from Japan and the US.

Daiwa Securities forecast that the company this year would register 20 percent revenue growth to NT$21.52 billion and 27 percent profit growth to NT$1.69 billion.

The revenue growth is said to be on the back of strong orders, according to Daiwa’s initial report on the company issued on Jan. 22.

Because of rising orders from Fast Retailing Co, Makalot’s fifth- largest client, which runs Uniqlo brand, Daiwa Securities forecast the company’s sales to the Japanese market would increase to 8 percent to 9 percent of its revenue this year.

up from 5 percent for last year, Daiwa analyst Helen Chien said in the report.

Chien said the company’s sales to Inditex Group, which operates the Zara brand, and Hennes & Mauritz AB (H&M), would surge to NT$861 million this year from NT$358 million a year earlier.

Sales to the two companies were 2 percent of Makalot’s revenue last year, she said.

As for Makalot’s online FISSO apparel brand, Chien said she estimated the business generated around NT$30 million in revenue for the company last year.

She added that the division would swing to the black within future two years.

The company’s shares rose 1.34 percent to NT$151 yesterday, outperforming the TAIEX, which was up 1.06 percent.

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