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Firstextile revenues up by 29%

Firstextile revenues up by 29% Source: ei.wtin.com
Date: 28-05-2013
Visits: 236
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Firstextile, a leading manufacturer of high-end yarn-dyed fabrics in the Chinese market, netted a total revenue of €47.7m in the first quarter of 2013 compared with €36.9m in the same period of 2012.

The revenue growth is said to be due to strong revenue increases in the Fabrics segment. The company's gross profit increased by 22.9% to €14.2m compared with €11.6m in the prior year period, resulting in a strong gross profit margin of 29.8%.

Firstextile's earnings before interest and tax (EBIT) rose by 15.1% to €9.6m (Q1 2012: €8.4m), corresponding to an EBIT margin of 20.2%. Net profit increased by 12.7% from €6.8m in the first three months of 2012 to €7.6m in the same period in 2013, according to the company.

Fred Yang, founder and CEO of Firstextile, said: “The positive business development reflected by our Q1 figures is an excellent start to the current financial year. Within the reporting period we were able to increase both our top line and bottom line. As a pre-approved supplier for government institutions and large state-owned enterprises together with our coherent strategy to increase our distribution network we are excellently positioned to successfully address future market demand.”

Richard Cao, CFO, added: “Currently, further growth is only limited by our capacities which are already fully utilised. Therefore we are already building up a new production facility to meet the high demand for our products. Initial production activity of the new plant is expected to start in the last quarter of this year. Due to this, the continuing positive economic environment and the currently good performance in all three business segments we are very confident of reaching our goals in 2013.”

Firstextile's revenue in the Fabrics segment amounted to €31.4m in the reporting period compared with €19.2m in Q1 2012. This growth is a result of an increase in both the average selling price and in the units sold, said the company.

At 65.8% compared with 52.2% in Q1 2012, the largest share of total revenue is generated from this segment. Gross profit also increased significantly year-on-year, growing by 89.8% to €9.4m, said the company.

Revenue in the Uniforms segment remained on a stable level compared with the previous year’s period and amounted to €12.7m. Since revenue in this segment generally depends on relatively few large orders a fluctuation in revenue quarter-on-quarter in this segment is not exceptional. On group level the Uniforms segment contributed 26.6% of total revenue compared with 37.2% in Q1 2012. Gross profit fell by 46.5% to €1.9m (Q1 2012: €3.6m) as a result of large orders that were carrying much lower gross profit margins and were mainly received from customers in the private security sector since the last quarter of 2012, said Firstextile.

In its third business unit, Branded Products, the company sells shirts under the brands Varpum and Firstextile as well as other branded products such as suits, jackets, pants, sweaters, T-shirts, shoes and other accessories.

Revenue in this segment remained on a comparable level with the first quarter of 2012 at €3.6m compared with €3.9m last year, according to the company.

It added that about half of the revenue in the previous year’s first quarter was attributable to large orders of three new distributors engaged in late March 2012 and that adjusted by this exceptional effect the revenue level in Q1 2013 reflects a sustainable improvement in this segment year-on-year.

On a group level the Branded Products segment contributed 7.6% of the revenue in the first three months of 2013 compared with 10.7% in the same period of the previous year. Gross profit remained stable at €2.8m in the reporting period, compared with €3m in Q1 2012.

Firstextile currently manufactures 36 million metres of fabric a year and has a market share in the Chinese market of 9% by volume.
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