During the period, revenue from the textile segment reached HK$1.4 billion, signifying an increase of 15% compared with the previous period.
Mr Chen Tien Tui, Chief Executive Officer of Victory City International, said: “Raw material and fuel costs are likely to stay at high levels; the upward trend in labour costs is expected to persist; and general operating costs will continue to rise. In view of these challenges, the Group will maintain its vigilance in further tightening its cost control measures and to further enhance its production efficiency and effectiveness. These measures, backed by our vertically integrated establishment, together with our environmentally friendly facilities, continue to provide a solid platform for our continual success.”
The garment segment continued to deliver a satisfactory performance during the period under review by achieving a 27% growth in revenue to HK$745 million, which accounted for 34% of the total revenue. With the impending elimination of export quotas, especially from the PRC to Europe in 2008 and to the USA in 2009, the Group will take further advantage of the migration of the garment industry to Asia, especially to China, by expanding manufacturing facilities and taking advantage of growing demand from the domestic apparel market. Management is confident that the garment business will continue to play a major role in the corporate development of the Group in the years to come.
Mr Andy Li, Chairman of Victory City, added: “The impact of the sub-prime crisis and an uncertain US economy have adversely affected consumer confidence, with purchase orders for both textile and garment products beginning to slow down in August 2007. With the accelerated consolidation of the fabric industry enabling us to increase our market share, we are now able to capture an even greater share of domestic and export markets with our quality products and efficient and comprehensive services. Overall, we continue to ride on the strong growth of the domestic PRC market and the ever-increasing international demand for garments manufactured in the PRC.”
Financial Highlights| Six months ended September 30, | ||
| 2007 | 2006 | |
| HK$ '000 | HK$ '000 | |
| unaudited | unaudited | |
| Turnover | 2,166,440 | 1,821,174 |
| Gross profit | 404,795 | 368,462 |
| Net profit attributable to shareholders | 174,750 | 156,367 |
| Basic Earnings per Share | HK26.4 cents | HK24.3 cents |
| Interim dividend per share | HK8.0 cents | HK7.2 cents |
About Victory City
Victory City International Holdings Limited (HKEx: 539) is one of Hong Kong's major manufacturers of knitted fabric with an approximately 10-million-sq-ft production facilities in Xinhui City, Guangdong Province. The Group's principal operations include production and sale of knitted fabric and dyed yarn, and manufacturing and trading of garment products.