• FY profit climbed 12.5% to US$506.2m
  • Turnover rose 3.6% to US$7.29bn
  • Shoe manufacturing turnover up 1.5% to US$5.07bn

Yue Yuen, the world's largest manufacturer of branded athletic and casual footwear, has seen its full-year profit jump 12.5%, helped by higher sales and more stable material prices.

The company, whose customers include Nike, Adidas, Reebok, Asics, New Balance, Puma, Timberland and Rockport, said total net profit rose to US$506.2m, up from $449.8m a year earlier.

Turnover in the 12 months to 30 September rose 3.6% to US$7.29bn.

Yue Yuen said retail and wholesale turnover, which was up 13.6% to $1.64bn, had been boosted by continued economic growth in Greater China and the opening of new stores.

But shoe manufacturing achieved turnover growth of just 1.5% to US$5.07bn as its brand customers - especially in Europe - were increasingly cautious in placing orders.

Sales of athletic shoes and casual/outdoor shoes were up by 1.8% and 0.5% respectively. But total shoe manufacturing volume fell by 5.4% to 308.9m pairs.

During the year, gross profit increased by 6.9% to US$1.66bn, helped by stable prices for materials and energy. Yue Yuen also said it had improved factory operating efficiency.

But selling, distribution and administrative expenses increased by 9.1% to US$1.15bn, driven by inflation in Asia, especially China, leading to rising wages and to higher rental costs.

Looking ahead, the group says it expects sales growth across its business to be "moderate," with profit growth "challenged by the variability of market conditions." In the long term, it sees greater demand for athletic and casual shoes as well as sportswear.