Hong Kong’s Lever Style Corporation’s revenue soars 51.2% in FY22

Hong Kong’s Lever Style Corporation, a leading supplier of multi-category apparel products, has reported a revenue increase of approximately 51.2 per cent to $217.2 million in fiscal 2022 (FY22), compared to $143.7 million in FY21, primarily driven by a rebound in demand for apparel post-COVID, winning new customers, and market share growth due to its industry-leading product range.

Lever Style Corporation’s gross profit increased by approximately 55.2 per cent from $39.7 million in FY21 to $61.6 million in FY22, while maintaining a gross profit margin of approximately 28.3 per cent in FY22. The company’s net profit was approximately $14.5 million, compared to $4.3 million for the previous year, the company said in a press release.

Lever Style Corporation reported a revenue increase of 51.2 per cent to $217.2 million in FY22, primarily due to increased demand for apparel post-COVID.
The US contributed the majority of revenue, followed by Europe and Oceania.
The company’s gross profit was $61.6 million, while the net profit was $14.5 million, and inventory was $14.46 million in FY22.

The company’s bottoms category was the highest revenue generator, accounting for approximately $66 million in FY22, followed by outerwear with approximately $48 million, and shirts with approximately $45 million. The suit category contributed approximately $19 million, whereas the soft woven and knit categories generated approximately $13 million and $9 million, respectively. The sweater and others categories accounted for approximately $6.8 million and $9 million.

With regards to geography, the majority of Lever Style Corporation’s revenue came from the US, with approximately $136 million, followed by Europe with approximately $41 million, and Oceania with approximately $16 million. The Greater China region accounted for approximately $8.7 million, whereas other countries contributed approximately $13.8 million to the revenue.

The company’s cost of sales increased by approximately 49.6 per cent from $104.0 million in FY21 to $155.6 million in FY22, mainly due to material costs and subcontracting fees. However, the cost of sales as a percentage of total revenue decreased from approximately 72.4 per cent in FY21 to approximately 71.7 per cent in FY22.

The company’s net cash position was approximately $12.8 million in FY22, while in FY21, a net debt of approximately $4.7 million was recorded. Inventory was $14.46 million compared to $20.47 million in FY21, the release added.

Furthermore, the company with its asset-light business model has attracted more factory partners to its platform due to its rapidly expanding client base and business volume. With over 100 factory partners supporting more than 100 brands, the company’s tech-enabled model has allowed it to accommodate higher demand growth during the reporting period. Lever Style has almost doubled its Vietnam production volume in just one year from 2021 to 2022, which would not have been possible if it was constrained by its own factories’ capacities. The company’s supply chain model is becoming more appealing to customers due to the unpredictability and disruption caused by fluctuating economic conditions, changing consumer demand, and geopolitical tensions.

Lever Style has integrated five acquisitions made in 2020-21 and now has the ability to produce most apparel products across different categories, making it a one-stop-shop for customers in the lifestyle and activewear industry. This helps customers reduce their supply chain complexity.

The company plans to continue digitalising all aspects of its supply chain platform to become more efficient and agile. To achieve this, Lever Style is investing in digital talent and infrastructure and has hired William Tan and Junfeng Liang, who have experience in digital transformation from multiple digital platform companies.

In 2023, Lever Style Corporation is positioning itself for merger and acquisition opportunities in the apparel industry, as this year is expected to be a difficult year for the industry. With a strong balance sheet, net cash position, and ample debt capacity, the company expects to take advantage of mergers and acquisitions to further scale its business. The company plans to grow organically and through merger and acquisition to strengthen its one-stop-shop offering and drive digital transformation.

Fibre2Fashion News Desk (DP)

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