Stella International (1836) H2 2024 earnings summary

Executive summary

• Achieved group revenue of US$1,545.1m in FY2024, up 3.5% year-over-year, with shipment volume rising 8.2% to 53.0 million pairs.

• Net profit increased 21.2% to US$170.1m; adjusted net profit up 16.0% to US$171.2m, excluding fair value losses.

• Operating profit margin rose to 11.9%, exceeding Three-Year Plan targets.

• Maintained strong net cash position of US$417.6m, up 45.3% from prior year.

• Full-year dividend per share increased 66% to 171 HK cents, including a special dividend.

Financial highlights

• Revenue grew 3.5% year-over-year to US$1,545.1m; shipment volume up 8.2%, ASP down 4.4%.

• Gross profit margin improved to 24.9%; operating profit margin at 11.9%.

• Net profit margin improved by 160bps to 11.0%; EPS rose 18.5% to US$21.1.

• Net cash position reached US$417.6m, up from US$287.4m last year.

• Cash flows from operating activities increased 15.2% to US$264.1m.

Outlook and guidance

• Confident in meeting 3-Year Plan (2023-2025) targets: 10% OPM and low-teens net profit CAGR.

• Expects macroeconomic headwinds in 2025, mitigated by new Sports customers and high-end Fashion growth.

• Plans to optimize and reallocate production capacity, expand in Indonesia and Bangladesh, and accelerate handbag business development.