Shenzhou International's revenue sets a record high of 27.78 billion yuan in 2022

Sports goods OEM giant Shenzhou International Group Holdings Co., Ltd announced its 2022 results recently. The financial report shows that in 2022, Shenzhou International achieved sales revenue of 27.781 billion yuan, a year-on-year increase of about 16.5%, hitting a historic high. The profit attributable to the owners of the parent company is about 4.563 billion yuan, a year-on-year increase of 35.3%.

The company believes that the growth of sales revenue in 2022 is affected by the increase in demand from major customers in international markets such as Europe and the United States. On the other hand, due to the relaxation of epidemic control by the local government in the overseas production bases of the Group, the capacity utilization has returned to normal level, and new capacity has continued to expand. In addition, the average selling price of products during the reporting period increased due to the impact of rising costs and the appreciation of the US dollar.

Sports products contributed more than 70% of revenue.

In 2022, Shenzhou International's sales in the European market is about 6.215 billion yuan, a year-on-year increase of 31.3%, accounting for 22.4% of total sales. Sales in the US market is about 4.873 billion yuan, a year-on-year increase of 28.1%, taking up 17.5% of total sales.Sales in the Japanese market is approximately 3.926 billion yuan, a year-on-year increase of 17.2%, accounting for 14.1% of total sales.

In China local market, Shenzhou International's sales fell 6.5% year-on-year to 6.905 billion yuan. Shenzhou International said that one of the main reasons is that the procurement demand of international brands in China's domestic market has declined.

In addition, Shenzhou International's gross sales margin is approximately 22.1% in 2022, a decrease of about 2.2 percentage points from 24.3% in 2021. It is said that the main reason for the decline is, on the one hand, the impact of rising prices of production factors such as raw materials and energy. On the other hand, in January and October 2022, due to the impact of the epidemic, the Group's production base in Ningbo was partially suspended for about half a month, which affected effective output, and at the same time, expenditures related to the epidemic also increased. In addition, due to the decline in global demand, the capacity utilization rate in the second half of the year was insufficient, but the Group did not lay off employees or shrink the scale of production capacity.

Shenzhou International also disclosed in the financial report that due to the weak global demand for apparels, major customers are still in the process of destocking. It is expected that the capacity utilization rate in the first half of 2023 will not reach the ideal level, and the operating income will decline compared with the same period in 2022, but in the second half of the year, there will be an overall recovery trend.