Tue, Mar 27, 2018 - Page 12 News List

Pou Chen posts net profit drop on higher expenses

By Kuo Chia-erh  /  Staff reporter

Footwear supplier Pou Chen Corp (寶成工業) yesterday reported a net profit of NT$12.92 billion (US$443.18 million) for last year, down 1 percent from NT$13.06 billion in 2016, mainly due to higher expenses to expand and renovate its retail business.

Earnings per share were NT$4.38, down slightly from NT$4.43 in 2016, the company said in a statement.

Revenue totaled NT$278.63 billion, up 1.4 percent from NT$274.9 billion the previous year, while gross margin rose to 26.2 percent from 25.6 percent, the statement showed.

However, operating expenses over the period increased 6.5 percent to NT$56 billion, while operating profit decreased 4 percent to NT$17.7 billion.

Expenses rose because of an ongoing plan to expand its distribution channels and revamp some of its existing stores, the company said.

Pou Chen, the world’s largest branded athletic and casual footwear maker, operates its sportswear retail business in China through its Hong Kong-listed subsidiary, Pou Sheng International Ltd (寶勝國際).

Footwear manufacturing accounted for 70 percent of its revenue last year, while its retail business made up the remaining 30 percent.

Sales from footwear manufacturing declined 4.7 percent annually to NT$185.6 billion last year, while its retail business grew 16.8 percent to NT$92.1 billion, company data showed.

Pou Chen in January announced plans to spend HK$10.9 billion (US$1.39 billion) to privatize and delist Pou Sheng from the Hong Kong Stock Exchange, with the aim of simplifying its management structure and repositioning its core businesses.

The shoemaker said it would hold its annual shareholders’ meeting on June 15.

Pou Chen shares edged up 0.66 percent to close at NT$38.20 in Taipei trading yesterday.

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