Ever-Glory International has reported a strong third quarter, with net sales up by 27.9% year-over-year to US$19.5m, leading to a 19% hike in non-GAAP net income of US$1.9m.

In a statement the Chinese-based apparel manufacturer said the sales increase was primarily the result of an overall increase to Europe, Japan and the US, where sales rose 38%, 21% and 16%, respectively, from the same period a year ago.

"We made major progress in the European market and continued to make inroads into the US. We received a new $4m production order from UK-based NEXT PLC and began filling additional orders with Walls Industries and QVC," said Yihua Kang, chairman and CEO of Ever- Glory. "With the elimination of Europe's export quota limit by year end, we look forward to additional sales growth in the coming year."

Including the acquisitions of New-Tailun and Catch-Luck and outsourced production, total annual production capacity is approximately 8m garment pieces, up from 2.85m garment pieces at the end of 2006, the company said.

The increase was related to the company's new factory and corporate headquarters in the Nanjing Jiangning Economic and Technological Development Zone in Nanjing, higher levels of outsourced production and the acquisitions of New- Tailun and Nanjing Catch-Luck.

For the 2007 fiscal year, the company expects to generate revenues of $68m to $70m and net income of $5.8m to $6.0m.

"We continued to make great strides in our strategy of strong, profitable growth, and we look forward to further progress during the final quarter of 2007," Kang said. "We have increased our capacity through the Catch-Luck transaction, which should help in our mission to become a leader in the Chinese apparel and design industry. We also improved our working capital position through the private placement of our convertible notes, which enables us to meet the ongoing cash needs of our day-to-day operations."

"In 2008, we hope to achieve success in the development of our company- owned brand, which will include clothing and accessories," said Kang. "We will begin marketing in developed cities in China, where customers have demonstrated greater discretionary spending on fashion items."