Sports footwear manufacturer Yue Yuen Industrial (Holdings) Ltd. (0551.HK) said on Wednesday that its revenue last year fell 1.8% year-on-year to $8.03 billion, while its net profit declined 2.9% to $381 million.
The company said global footwear demand last year was affected by tariff policies and geopolitical uncertainties, prompting its brand customers to adopt more cautious procurement strategies. Coupled with a high comparison base from 2024, footwear shipments slipped slightly to 252 million pairs last year. However, a more favorable order mix lifted the average selling price to $21 per pair, partly offsetting the impact of lower shipment volumes.
By segment, the company’s manufacturing revenue edged up 0.5% year-on-year to $5.65 billion, while footwear manufacturing revenue rose 2.5%. By comparison, the retail segment was pressured by weak consumer confidence in China and elevated inventory levels, leading to a 7% year-on-year revenue decline to $2.38 billion for Yue Yuen’s Pou Sheng International subsidiary.
Yue Yuen’s gross margin fell to 22.8% last year, down 1.6 percentage points from a year earlier. Management said uneven factory capacity utilization, rising labor costs and ramp-up expenses for new production lines weighed on its profitability.
Looking ahead, the company said uncertainties surrounding the global economy and tariff policies remain. It will continue to diversify its production footprint, including expanding its manufacturing capacity in Indonesia and India, while improving efficiency through digitalization and automation to reinforce its position in the global sports footwear supply chain.
Shares of Yue Yuen opened flat on Thursday, closing at HK$17.38 by the midday break, down 3.98%. The shares have risen about 35% over the past six months.
By Lee Shih Ta
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