Crystal International Announces 2017 Annual Results

Revenue Increased by 23.5% to US$2,178 Million
Net Profit Increased by 20.1% to US$149 Million 
Strong Growth Momentum Leveraging Co-creation Business Model
Maintaining Leading Market Position in Apparel Industry

Results Highlights

• Revenue for the year ended 31 December 2017 amounted to US$2,178 million, representing an increase of 23.5%
• Net profit for the year ended 31 December 2017 amounted to US$149 million, an increase of 20.1%
• Proposed to declare a final dividend of HK$0.123 (approximately US$0.016) per ordinary share

HONG KONG, March 16, 2018 /PRNewswire/ -- Crystal International Group Limited ("Crystal International" or the "Company"; together with its subsidiaries, the "Group", Stock Exchange stock code: 2232), a global leader in the apparel manufacturing industry, is pleased to announce the audited consolidated financial results for the year ended 31 December 2017 ("the Year").

Financial Highlights

Significant growth in denim and intimate segments

During the year, revenue from sales of denim amounted to US$560 million, representing an increase of US$76 million or 15.7%. The increase in revenue was the consequence of generating more orders from existing customers under the Group's co-creation business model, environmentally friendly and sustainable denim manufacturing techniques catering to customers' needs, and enhanced customer penetration due to supplier consolidation by customers. Revenue from sales of intimate amounted to US$378 million, representing an increase of US$84 million or 28.6%, which was mainly attributable to an increase in demand from customers for commercially successful co-creation products.

Continuous growth in worldwide markets

For the year ended 31 December 2017, the Group's revenue from the Asia Pacific market increased by 21.5%, driven by increased customer demand. The Group's revenue from the United States market increased by 30.8%, which was mainly due to increased business with existing customers that has resulted from application of our co-creation philosophy. The Group's revenue from the European market increased by 15.0% resulting from increased customer demand.

Business Review and Future Prospects

During the year, global major apparel retail markets experienced recovery in demand, supported by strong holiday sales as reported by our branded customers. Economic growth is favourable for the development of the apparel manufacturing industry, especially in Asia, the largest apparel production base in the world. The Group has 20 self-operating manufacturing facilities in Vietnam, the PRC, Cambodia, Bangladesh and Sri Lanka, enabling us to shift our production base from the PRC to other Asian countries to take advantage of their relatively lower operating costs. The Group's diversified product portfolio has given us an important competitive advantage, offering us significant potential in cross-selling and co-creation with our key customers. It will also continue to offer us the opportunity to develop new product categories as well as new products, thus further increasing our scale, strengthening our existing relationships and winning us new customers. The significant size of the Group's operations enables us to benefit from large economies of scale across the industry value-chain. These attributes enhance our leading market position among customers and suppliers alike and improve our bargaining position.

While the global apparel manufacturing industry is as highly fragmented as it is ever changing with many manufacturers of varying scale of operations, the Group's leading market position will continue to enable us to capture consolidation opportunities.

Mr. Lo Ching Leung Andrew, Chief Executive Officer and Executive Director of Crystal International commented, "Looking ahead, we will continue to grow our business through focusing on our co-creation business model for growth opportunities and profitability, strengthening cross-product innovation and cross-selling capabilities for further customer penetration, with on-going improvement of our product mix and development of new product categories for future growth. Meanwhile, the Group will continue to expand to low cost countries to leverage local expertise and enhance efficiency for margins expansion, coupled with upstream vertical expansion into fabric production for better margins. We will also continue with our focus and dedication on human capital and environmental consciousness for sustainable growth of the Company."

About Crystal International Group Limited

Founded in Hong Kong in 1970, Crystal International Group Limited (the "Group") is a global leader in the apparel manufacturing industry with a diversified product portfolio under its highly differentiated value-add driven co-creation business model. In 2016, it ranked first by production volume, with 7 out of the top 10 global leading brand apparel companies as its customers. The Group's products are categorized into five segments, namely, lifestyle wear, denim, intimate, sweater, and sportswear and outdoor apparel, and enjoyed leading market positions in Asia for a number of its product categories.

The Group's co-creation business model offers its customers the right product at the right time at the right cost, which is a critical component to the success of global apparel brands in an ever-changing industry environment. Operating a multi-country manufacturing platform, it has established a significant scale of operations with 20 self-operating manufacturing facilities spanning across five countries, namely, China, Vietnam, Cambodia, Bangladesh and Sri Lanka.