Shoe supplier Pou Chen Corp (寶成工業) has denied rumors that it would withdraw from Vietnam and China because of a slew of labor strikes over the past few years.
The world’s largest athletic and casual footwear maker said it would continue manufacturing shoes in Vietnam and China, while looking to expand to other countries such as Indonesia and Myanmar.
The company would improve its communication with workers and devise measures to improve labor relations, chief executive officer Tsai Pei-chun (蔡佩君) told reporters on Friday last week after the company’s annual general meeting.
Pou Chen’s four Vietnamese plants in Ho Chi Minh City, Dong Nai, Tay Ninh and Tien Giang halted production because of protests there, but resumed manufacturing on Thursday.
Protesters demonstrated earlier last week across Vietnam to oppose government plans to allow foreign investors to lease land for up to 99 years in three special economic zones.
They say the plans would allow Chinese firms in particular to seize Vietnamese land, media reports said.
Vietnam is Pou Chen’s largest production base, and contributed about 45 percent of its total sales last year, while Indonesian and Chinese operations accounted for 36 percent and 17 percent respectively, the company said.
Last year, Pou Chen produced 324.6 million pairs of shoes for brands like Nike, Under Armour, Adidas, Reebok, Asics and New Balance, up from 322 million pairs in 2016, company data showed.
The company operates its retail business in China through a Hong Kong-listed subsidiary, Pou Sheng International Ltd (寶勝國際).
Shoe manufacturing accounted for 66.6 percent of the company’s total sales last year, down from 70.9 percent a year earlier, while retail business made up 33.1 percent of its sales, up from 28.7 percent the previous year, Pou Chen said.
Pou Chen reported its revenue increased 1.4 percent year-on-year to NT$278.63 billion last year and its gross margin rose from 25.6 to 26.22 percent.
However, the company saw its net profit decrease 1 percent to NT$12.92 billion because of higher expenses from expanding and renovating its retail business.
Shareholders on Friday approved Pou Chen’s distribution of a cash dividend of NT$2 per share, the highest in 10 years. It represented a payout ratio of 45.7 percent, based on earnings per share of NT$4.38 last year.
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