The mandatory payment of minimum wages to factory workers idled by the Covid pandemic caused Kingmaker to post a negative gross margin for the first half of its fiscal year ended Sept. 30, leading it to report a net loss of 15.5 million Hong Kong dollars (€1.8m-$2.0m) compared with a profit of HK65.6 million in the year-ago period.
While its Cambodian footwear plant remained in operation throughout the period, its Thuan An factory in the southern part of Vietnam was closed throughout the second quarter due to the Covid epidemic. It is now working at about 80 percent of its capacity.
The company’s revenues slipped by 3 percent to HK$379.4 million (€43.2m-$48.8m) during the six-month period, as an improvement of 0.8 percent in average selling prices partly offset a decline of 3.2 percent in the number of pairs sold.
Sales of athletic footwear declined to zero from 5 percent of revenues a year earlier. Casual and children’s shoes were down as well, whereas rugged outdoor footwear grew to represent almost two-thirds of the turnover.
Sales to U.S. clients more than tripled to HK157.1 million (€17.9m-$20.2m), but they fell by 22 percent in Europe and by 43 percent in the rest of the world.
