Everest plans on revenue growth

MIDDLE CLASS TARGETED::The textile company launched its own brand at the end of last year and is seeking a place in the market alongside the Banana Republic brand

By Camaron Kao  /  Staff reporter, in Greater Tainan

Thu, Dec 12, 2013 - Page 14

Everest Textile Co (宏遠興業), which makes fabrics and garments, is targeting an increase of between 15 percent and 20 percent in revenue next year from this year as the company increases sales of knitted fabrics for clients including Lululemon Athletica Inc.

“Knitted fabrics will account for 25 percent of our revenue next year, up from 10 percent this year,” Everest president Roger Yeh (葉清來) told reporters on Tuesday.

Lululemon was Everest’s fourth-largest client in the second half of this year and might replace Columbia Sportswear Co to become the third-largest next year, according to the company.

Currently, Nike Inc is Everest’s largest client, accounting for about 25 percent of its total revenue, trailed by North Face Inc, with a 15 percent share, company data showed.

The Greater Tainan-based company reported revenue of NT$745.95 million (US$25.24 million) last month, up 14.39 percent year-on-year but down 0.24 percent month-on-month.

Revenue has shown year-on-year increases since May after the company adjusted its fabrics slightly to include some functional features, instead of only selling fabrics for fashionable apparels as it had before, Yeh said.

The company now expects revenue for this month to grow 34 percent year-on-year to NT$760 million, boosting sales this quarter to reach the highest level this year, he said.

In the first 11 months of the year, cumulative revenue rose 1.62 percent to NT$6.92 billion from the year-earlier level. The company aims to register 4 percent revenue growth this year from last year, thanks to a 10 percent sales increase in Thailand and a 20 percent rise in China.

Thailand accounts for 10 percent of the company’s total revenue and China makes up 20 percent, while Taiwan holds the lion’s share of 70 percent, Yeh said.

During the first nine months of this year, the company’s net profit declined 75.3 percent to NT$144.33 million, or NT$0.33 per share, from NT$584.28 million, or NT$1.34 per share, a year ago because of insurance claims of NT$450 million last year after a fire broke out in March 2010. Operating profit grew 12.69 percent in the first nine months to NT$121.89 million from NT$108.16 million a year ago, company data showed.

Yeh said he expects profit next year to be higher than this year, but did not elaborate.

Everest launched its own brand — EverSmile — at the end of last year, targeting affluent, middle-class customers.

“We position our brand similar to Banana Republic,” Yeh said.

EverSmile’s garment sales have risen to NT$440,000 a day this month from between NT$10 million and NT$12 million a month in the first 11 months of this year, Yeh said.

“The brand will account for 1.5 percent of Everest’s revenue this year,” he said.

The company has increased the number of stores in Taiwan selling EverSmile apparel to 54 from fewer than 20 at the beginning of this year, Everest vice president Alice Kao (高錦雀) said.

Everest plans to open six new stores by the end of this year and increase the total number of its retail outlets to 100 by the end of next year in an effort to raise EverSmile garment sales to between NT$15 million and NT$20 million a month next year, Kao said.