In a business update for the third quarter, Stella International said shipment volumes declined by 23.6 percent from the year-ago quarter to 12.3 million pairs, while its total sales plunged by 23.3 percent to $344.5 million, including those of its in-house brands. The Chinese footwear company’s revenues from manufacturing improved sequentially from the second quarter, thanks to the reopening of retail stores after lockdowns. However, they were still down by 25 percent year-on-year to $336.7 million due to lower demand amid the pandemic. The average selling price inched down to $27.50 from $27.80.

Looking ahead, Stella said some of its shipments may be delayed from the fourth quarter of 2020 to the first quarter of 2021 if brand clients experience weak sell-through during the upcoming holiday period and high inventory levels, due to the resurgence of Covid-19 in Europe and North America.

In any case, the company said it will continue to push forward with long-term strategies, including an accelerated migration of its production capacity to Southeast Asia to enhance the long-term cost structure. Its financial position continues to be solid, with total undrawn bank facilities of over $180 million.

The group remains focused on growing its base of clients in the fashion sports segment, where sports brands are seeing increasing demand, as well as among high-fashion brands expanding into the athleisure category.