The revenues of Stella International, the Chinese footwear group based in Hong Kong, rose by 58.1 percent to $392.1 million in the second quarter of 2021 from $248.0 million a year earlier, when the company’s sales were negatively impacted by the outbreak of the Covid-19 pandemic. The top line, however, stood below the $435.4 million level reached in the second quarter of 2019.
Driven by a recovery in orders, revenues from manufacturing increased to $383.9 million in the quarter from $247.8 million a year earlier and shipments grew by 54.3 percent to 14.5 million pairs from 9.4 million. The average selling price increased slightly to $26.5 a pair from $26.4.
For the six months to June 30, overall sales jumped by 36.1 percent $695.5 million, with revenues from manufacturing rising to $683.7 million from $504.5 million the previous year. Deliveries grew by 29.9 percent to 26.5 million pairs from 20.4 million and the average selling price grew to $25.8 from $24.7. Thanks to the revenue growth, Stella anticipates to post a net profit of at least $30 million in the first half of 2021 compared with a net loss of $5.2 million a year earlier.
The company is “cautiously optimistic” about orders in the second half of the year and expects the pace of the recovery in volumes and revenues to moderate due to a stronger comparision base. It also warned about recent lockdowns in many parts of Asia and the continued risk posed by the Covid-19 pandemic.
Stella indicated that it continues to prioritize margin improvement by upgrading its product mix and attracting “high-quality” customers in the sports and luxury footwear segments. It will also focus on steady volume growth, risk management and cash flow generation in order to safeguard a “strong” financial position. The group stressed that it is “making good progress” in expanding its production capacity in Southeast Asia.
