Shenzhou International's latest financial report is released! Revenue rises and profits declines. These changes have taken place in the global foundry business

Sales in the European market were approximately 2.14 billion yuan, an increase of 11.7% over the same period last year, mainly due to the increase in demand for sportswear purchases in the European market;

Sales in the Japanese market increased by 3.0% to 2.01 billion yuan during the same period, mainly due to the increase in demand for underwear and casual wear, and the impact of the decrease in demand for sportswear;

During the reporting period, the Group's sales in other markets including Russia, South Korea and Taiwan reached 2.15 billion yuan, an increase of 5.3% over the same period last year, mainly due to the increase in casual wear and underwear apparel in markets such as South Korea and Russia;

During the reporting period, sales in the domestic market increased by 15.1% over the same period last year, of which garment sales were approximately 3.218 billion yuan, an increase of 15.5% over the same period last year, mainly due to the rising demand for clothing consumption in the domestic market.

According to customs statistics, the total export value of China's textile and apparel (including textile yarns, fabrics and products, and apparel and clothing accessories) in the first half of 2021 was approximately US$140.09 billion, an increase of approximately 12.1% over the same period last year, of which textile exports fell by 7.4 year-on-year. % To 68.56 billion U.S. dollars, and apparel exports increased by about 40.3% to 71.53 billion U.S. dollars. The reason for the surge in domestic apparel product exports was analyzed. The main reason is that the domestic control of the epidemic is ideal, so the stability of the apparel industry’s supply chain is significantly better than other productions. With the recovery of domestic economic growth and the gradual elimination of the impact of the epidemic on consumption, the clothing consumer demand in the domestic market will usher in a significant rebound.

The impact of the current epidemic on the global supply chain is further expanding. Southeast Asian countries have low vaccination. Since mid-July, the new crown epidemic in Vietnam has significantly worsened. The Vietnamese government adopted social distancing measures on July 19, and the measures are still being implemented until today. Many foundries in Vietnam have suspended operations, and some apparel and footwear companies, including Adidas, may adopt price increases. It is understood that in 2020, production bases in Vietnam and Cambodia have contributed nearly 40% of the garment production capacity to Shenzhou International. The Group’s production bases and factories in Vietnam have also been affected by the outbreak. As a brand partner of Adidas, Puma, Nike, Uniqlo and other brands, Shenzhou International stated that in the face of this business environment, the first consideration is the stability and competitiveness of the supply chain. Next, the group will:

Optimize the matching of upstream and downstream processes in the supply chain at different bases, stabilize the supply chain, and quickly respond to customer orders and reduce customer import tariff costs;