Ever-Glory (EVK) Reports Q1 Loss of $0.08 on Revenues of $70.8M

May 14, 2021 6:05 AM EDT

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Ever-Glory (NASDAQ: EVK) reported Q1 EPS of ($0.08), versus ($0.18) reported last year. Revenue for the quarter came in at $70.8 million, versus $58.4 million reported last year.

First Quarter 2021 Financial Results

  • Total sales for the first quarter of 2021 were $70.8 million, a increase of 21.4% from $58.4 million in the first quarter of 2020. This increase was primarily driven by a 4.2% increase in our wholesale business and a 32.0% increase in retail business.
  • Sales for the Company's branded fashion apparel retail division increased by 32.0% to $47.6 million for the first quarter of 2021, compared with $36.1 million for the first quarter of 2020. This increase was primarily due to the increase in same-store sales. The Company had 921 retail stores as of March 31, 2021, compared with 1,038 retail stores as of March 31, 2020.
  • Sales for the Company's wholesale division increased by 4.2% to $23.2 million for the first quarter of 2021, compared with $22.3 million for the first quarter of 2020. This increase was primarily attributable to increased sales in Mainland China, Hong Kong, the United Kingdom, and other European markets partially offset for decreased sales in Japan and the United States.
  • Total gross profit for the first quarter of 2021 increased by 39.9% to $22.4 million, compared with $16 million for the first quarter of 2020. Total gross margin for the first quarter of 2021 increased to 31.7% from 27.5% for the first quarter of 2020.
  • Gross profit for the retail business increased by 42.5% to $17.9 million for the first quarter of 2021, compared with $12.5 million for the first quarter of 2020. Gross margin for the first quarter of 2021 was 37.6% compared to 34.8% for the first quarter of 2020.
  • Gross profit for the wholesale business increased by 30.5% to $4.6 million for the first quarter of 2021, compared with $3.5 million for the first quarter of 2020. Gross margin for the first quarter of 2021 increased to 19.6% from 15.7% for the first quarter of 2020.
  • Selling expenses for the first quarter of 2021 increased by 15.4% to $15.5 million, or 22.0% of total sales, compared with $13.5 million, or 23.1% of total sales for the first quarter of 2020. The increase was attributable to the increased sales.
  • General and administrative expenses for the first quarter of 2021 increased by 35.7% to $7.9 million, or 11.1% of total sales, compared with $5.8 million, or 9.9% of total sales for the first quarter of 2020. The increase was mainly attributable to the decreased business trip and the exemption of social benefits by the PRC government in 2020.
  • Loss from operations was $1.0 million for the first quarter of 2021,compared to $3.2 million for the first quarter of 2020.
  • Net loss attributable to the Company for the first quarter of 2021 was $1.2 million compared with $2.7 million for first quarter of 2020. Basic and diluted loss per share were $0.08 for the first quarter of 2021 compared with $0.18 for the first quarter of 2020.

Mr. Yihua Kang, Chairman, President and Chief Executive Officer of Ever-Glory, said, "During the first quarter, we maintained our focus on developing the retail business through our multi-brand strategy and store network optimization initiative, while improving our wholesale business by upgrading customer portfolio and enhancing our account receivables."

"During the first quarter of 2021, our retail brands continue to attract new customers and retain existing customers by focusing on design, quality and value," Mr. Kang continued. "Following the remodeling or relocation of 50-100 stores during 2021, we operated a nationwide network of 921 stores as of March 31, 2021."

"Looking at our wholesale business, we maintained focus on upgrading customer portfolio to reduce credit risk and improve margin in light of weak micro-environment and enhancing our account receivables. Going forward, we'll implement a stricter client evaluation system and remain diligent in our account receivables collection. We believe the enduring strength of our wholesale business will support its long-term profitability." concluded Mr. Kang.

Mr. Jason Jiansong Wang, Chief Financial Officer of Ever-Glory, added, "The first quarter results, are coupled with our ability to increase operating leverage. Going forward, we remain confident in the long-term prospects of our business and we will continue implementing our margin enhancement and cost control measures to further strengthen the profitability of our business."

For earnings history and earnings-related data on Ever-Glory (EVK) click here.



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