These brands ? notably Stepper, Cindy and Sakura ? still comprise only a small portion of the Hong Kong-based company's overall sales, but their revenues increased by 53 percent to HK$23.6 million (€2.5m-$3m) for the six months ended June 30. Europe accounted for 46 percent of this turnover, as compared to 40 percent in the year-ago period, and North America's share grew to 24 percent from 13 percent, while Asian distribution fell to 14 percent from 32 percent. The group is exploring possibilities to license out some of these brands to cross-sell them with its ODM customers.
The company's overall turnover rose by 37.2 percent to HK$331.3 million (€34.6m-$42.5m), and net earnings climbed by 41.8 percent to HK$51.2 million (€5.3m-$6.6m). Strong growth was achieved in Europe, where sales rose by 62 percent to HK$160.6 million (€16.7m-$20.6m), and in the USA, with sales up 29 percent to HK$120.5 million (€12.6m-$15.4m). Sales in Asia declined by 11 percent to HK$33.3 million (€3.5m-$4.3m), but they generate a profit against a loss last year.
Gross margins fell to 34.2 percent from 34.5 percent, largely because of higher raw material and energy costs. Sales to ODM customers rose by 40 percent to HK$295.9 million (€30.8m-$37.9m). Retail sales decreased by 21 percent to HK$11.8 million (€1.2m-$1.5m), as the group closed outlets in Nanjing and Shanghai. Arts Optical now operates 18 shops in China, with 12 in Beijing and six in Shenzhen.
Meanwhile, the group has appointed Wong Chi Wai, a certified public accountant, as an independent non-executive director.