Thu, Jan 12, 2017 - Page 12 News List

Fulgent gives positive annual forecast

PRODUCT PORTFOLIO:Gore-Tex certified products sell at a higher price and offer higher gross margin than other sports shoes, making up 90% of Fulgent’s sales last year

By Kuo Chia-erh  /  Staff reporter

Fulgent Sun Group (鈺齊國際), which produces shoes using specialized fabrics, such as Gore-Tex, gave a positive sales outlook for this year on the back of robust demand for functional footwear.

Sales growth momentum could be sustained in the first quarter from last quarter, the company said in a statement on Tuesday, citing the current quarter as a peak season for its major clients.

Fulgent Sun’s global brand customers include Timberland, Under Armour and Columbia, the company’s Web site showed.

The outdoor footwear supplier also expects that an improved product portfolio and continuous capacity expansion would continue stimulating its sales this year.

Fulgent Sun has been working to improve sales contribution from its Gore-Tex certified products, which have higher selling prices and gross margins compared with its other sports footwear.

Revenue from Gore-Tex related footwear accounted for more than 90 percent of the company’s total sales last year, compared with 75.7 percent in 2014.

The improved product portfolio helped Fulgent Sun’s average selling price increase from US$22.4 to US$27.9 in the past two years, company data showed.

It would develop more functional footwear for its brand customers this year, without elaborating, Fulgent Sun said.

As for near-term capacity expansion targets, Fulgent Sun said it aims to increase the production capacity of its plants in Cambodia and Vietnam, as part of the efforts to diversify operational risks.

PRODUCTION LINES

The Yunlin-based outdoor footwear supplier operates six factories in China, Vietnam and Cambodia.

Its Chinese factories contribute nearly 50 percent of the company’s total capacity, compared with 67.3 percent in 2014.

This year, Fulgent Sun is to set up five production lines at its Cambodia plant and three at its Vietnam plant, company officials told an investors’ conference in Taipei last month.

The company saw its net profit expand five times to NT$702 million (US$22 million) last year from NT$115 million a year earlier, with earnings per share improving from NT$0.88 to NT$5.23, a company statement showed.

Accumulated sales totaled NT$9.08 billion last year, representing a 0.37 percent increase from the previous year.

Fulgent Sun attributed the better-than-expected performance to record-high gross margin and effective cost management.

The company’s gross margin reached 18 percent last year, compared with only 12.99 percent in 2015, company data showed.

Fulgent Sun shares dropped 1.39 percent to close at NT$63.8 in Taipei trading yesterday, while the benchmark TAIEX slid 0.04 percent to 9,345.74 points.

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