Ruhong Chairman Hong Zhenhai said that although the Sino-US trade war has made the market full of uncertainty, the benefits of concentrated order placement by brand customers and the increase in new customer purchases will push up 2020. Operations are better than 2019. Overall observation shows that brand customers have better growth than channel customers.
Ruhong held a legal conference on November 12, 2019. On the eve of the legal conference, Ruhong also announced a net profit after tax of 1.191 billion yuan in the third quarter of 2019. , an annual increase of 14.9%, a new single-quarter high since 2019. The net profit after tax in the first three quarters was 3.163 billion yuan, which has earned one share capital. Hong Zhenhai mentioned that the operation in the fourth quarter will be better than the previous quarter.
Looking forward to the future, Hong Zhenhai said that it can be observed that the overall performance of brand customers will be better than that of channel customers. This is mainly due to the rapid response strategy of brand customers and the substantial growth in performance. In addition, the leading international sports brand has taken a fancy to Ruhong’s development and design capabilities, making the company one of the top five suppliers of the brand, and the benefits of concentrated orders have become more obvious, all of which support Ruhong’s operational optimism in 2020.
He further said that judging from the orders on hand, the company will need to increase its production capacity by more than 1.8 million pieces per month in 2020 to digest the orders. Therefore, the company has decided to adjust its Vietnam factory. High wages solve the problem of labor shortage. It is estimated that self-owned factories will be able to add 800,000 more units, and contracted factories are expected to absorb 450,000 units.
Hong Zhenhai emphasized that Ruhong fabrics such as Bodymapping and 30 denier series are hot-selling styles, among which the production schedule for 30 denier orders has been stretched to more than half a year. .
Hong Zhenhai pointed out that fabrics will be the main driving force for Ruhong this year, and garments will have greater growth in 2020. It is estimated that brand customers will account for Ruhong’s revenue this year. At least 72%, and distributors are more than 30%. It is expected that brands will still be the main force in growth in 2020. Distributors are affected by the Sino-US trade war, and their order placement is conservative and visibility is low. The single largest customer will account for 15% in 2020. .
As for the Indonesian integrated investment project, it was originally planned to mass-produce a garment factory in the second quarter of 2021. However, civil engineering found that the local soil quality was poor and improvement projects had to be invested first. Therefore, The production schedule has been extended to the third quarter, and the fabric factory will be set up in 2022. Currently, it only accepts medium and large orders for Indonesia’s consistent positioning, and provides quick response style orders.
