Youngor Group‘s 2023 Annaul Report: Fashion Segment Exceeds 7 Billion Yuan

5月 07, 2024

On the evening of April 29, Chinese apparel company Youngor (SH:600177) released its 2023 annual report, focusing on its core business—the fashion segment. In 2023, Youngor seized opportunities from the consumer recovery, achieving restorative growth: revenues increased by 15.7% year-over-year to 7.31 billion yuan, and net profit attributable to the parent company rose by 22.8% to 768 million yuan. The fashion segment’s share of total revenue increased from 42.6% in 2022 to 53.2% in 2023.

Dividends are the touchstone of profit and cash. The Youngor board proposed a profit distribution plan: a cash dividend of 0.50 yuan per share, totaling 2.31 billion yuan, representing 67.32% of the 2023 net profit attributable to the parent company.

Notably, Youngor will adopt an innovative “quarterly dividend” method in the fiscal year 2024, changing from an annual dividend to quarterly dividends. Specifically, the company will combine the undistributed profits from the first quarter, half-year, and third quarter of 2024 with the current performance to implement three mid-term dividends in September and December 2024, and March 2025. The company stated that “quarterly dividends” would stabilize dividend expectations for investors, shorten the wait for dividend returns, and significantly enhance investor satisfaction.

Since its listing in 1998, Youngor has consistently prioritized reasonable returns to investors, annually distributing cash dividends, with a total of 25 cash dividend implementations amounting to 24.792 billion yuan. The dividend payout ratio has reached 45.09% (excluding the 2023 dividend).

Youngor also released its first quarter report for 2024 alongside this. Looking at the fashion segment, it achieved a revenue of 1.85 billion yuan, a year-over-year decrease of 7.84% (where the branded apparel business achieved 1.61 billion yuan, down 3.44% year-over-year); net profit attributable to the parent company was 279 million yuan, down 20.6% year-over-year.

As of the close on April 30, Youngor’s share price rose by 3.31% to 7.81 yuan per share, with a total market value of 36.2 billion yuan.

In January 2021, Youngor established Youngor Fashion (Shanghai) Technology Co., Ltd., setting up in Shanghai’s T8 Fashion Center. While cultivating its own brands, Youngor has explored synergistic collaborations with international brands through acquisitions and partnerships, entering industries such as skiing, sailing, golf, and cycling, and laying out a fashion industry ecosystem.

In December 2023, Youngor announced that it plans to change its corporate name from “Youngor Group Co., Ltd.” to “Youngor Fashion Co., Ltd.” to further focus on its core fashion business, as reported by Luxeplace.

Beyond its main brand YOUNGOR, the group currently has four self-incubated brands: MAYOR, HART MARX, HANP; it has also invested in/cooperated with Undefeated and Helly Hansen, which are now fully operational.

During the reporting period, the main brand YOUNGOR enhanced its administrative and business strengths while expanding into leisure categories and relaunching its wedding series, achieving a revenue increase of 16.5% to 5.84 billion yuan and a gross profit increase of 15.4% to 4.28 billion yuan, both reaching historic highs.

MAYOR, HART MARX, HANP, and UNDEFEATED brands collectively grew by 5.9% year-over-year to 421 million yuan, with 49 new stores opened, bringing the total to 100 by the end of the period.

In terms of channels, during the reporting period, the company continued to implement its strategy of “opening large stores and closing small ones,” opening 118 new self-operated stores with an average area of 290 square meters; expanding 88 stores, adding an average of 76 square meters each; and closing 240 stores, averaging 163 square meters each. By the end of the period, the total number of self-operated stores was 1,729, a net decrease of 122 from the beginning of the year, but with an increased total operating area to 452,100 square meters.

In 2023, the average revenue per self-operated store reached 2.75 million yuan, with store efficiency up 25.8% year-over-year.

During the reporting period, the Ningbo headquarters fashion experience pavilion and the Nanning fashion experience pavilion opened. Youngor stated that the experience pavilions not only establish urban landmarks and enhance brand recognition but also fully display the independent image of the company’s various brands, providing consumers with an excellent shopping experience.

Moreover, Youngor increased its channel investments, acquiring 8 new stores with a total area of 110,000 square meters, laying a foundation for the subsequent construction of fashion experience pavilions.

Li Rucheng, Chairman of Youngor Group, stated in his letter to shareholders in the annual report:

“The company is clearer and more determined about its future development goals. According to the goal of building a world-class fashion group, all work is being actively and orderly advanced. We have increased our investment in the fashion industry and reduced investments in other non-related industries. The theme is more clear!

The construction of new retail is steadily advancing. Based on massive investments, the construction of fashion experience pavilions is gradually taking shape, making beneficial trials for future development!”

| Source: Youngor financial report, historical reports from Luxeplace

| Image Credit: Youngor official website, provided by the brand

| Editor: Elisa