Ever-Glory Announces Ever-Widening Losses
The trade-by-appointment stock Ever-Glory International Group, Inc. (Nasdaq: EVK) inched up a penny or so to 82 cents per American depositary share in Friday early trading after announcing weak sales for the first quarter.
The Nanjing-based fashion apparel retailer said in a statement today that in the three months through March that its sales reached $58.36 million, down 34% year-over-year. Net loss was $2.7 million compared with $455,000 in the same period in the preceding year.
The poor sales results in the quarter were because of a decline in its wholesale business and retail business, which decreased by 21% and 40% respectively.
"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," Yihua Kang, the chairman, president, and chief executive officer of Ever-Glory, said in a statement today.
He added, "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."
The news comes as retail revenue of clothing, shoes, hats, and knitwear in China in March plummeted to 68.9 billion yuan, down 55% from January and February, according to data from Statista.
Over the last three years Ever-Glory International Group, Inc. has seen its earnings shrink per share by an average of 8.9% per year. In the last year, revenue is down 15%.
The market has been tough for Ever-Glory, as it hasn't closed above $1 per share since Apr. 15; it trades only 6,000 or so sahres per day. Shares of Ever-Glory are down 46% year-to-date.
Operating since 1994, Ever-Glory provides apparel to women in China through its brands La go go, Velwin, Sea To Sky, and idole. It also has a global apparel supply chain and focuses on middle-to-high end casual wear, outerwear, and sportswear brands. As of March, Ever-Glory operated a nationwide network of 1,038 stores.
Going forward, it's hard to imagine that fashion is a good space to be in as people replacing their fedora for tight-fitting sugical masks. The company did not say whether or not it has been impacted by Covid-19 specifically, and did not provide guidance.
SMIC Doubles STAR Offering as Stock Gains on China's Growing Chip Market
Future FinTech Soars on Revenue Growth
The S&P 500 Ride Ahead – Rocky or Not So Rocky?
The Factors Driving the S&P 500 Bulls
Happiness Biotech Gets Green Light to Sell Hand Sanitizer in Canada
Novavax Jumps 31% on Securing $1.6 Billion for its Covid-19 Vaccine