L2 net loss of about 5.4 million Lilang brand still has a lot of room to expand

In the first half of the year, Fujian's other leading men's business casual men's wear brand and Hong Kong stock China Lilang achieved bright results, and was named "Top Ten Hong Kong Stock Market Institutional Recommendations".

During the reporting period, the company’s operating income was 1.032 billion yuan, an increase of 31.2% year-on-year; average sales price rose 13.2% to 163 yuan; gross profit increased 37.7% to 376 million yuan; gross profit margin increased 1.7 percentage points to 36.4%; net profit growth 63.1% to 228 million yuan. As of the end of June, the average inventory turnover days fell from 53 days at the end of last year to 49 days. Trade receivables turnover days fell from 71 days to 70 days, and trade payable turnover days increased from 81 days to 96 days.

L2 net loss is about 5.4 million

It will take time to achieve balance

Although the company’s main brand “Lilang” has increased revenue and profits by more than 30% year-on-year, the performance was bright. However, the sub-brand L2’s net loss for the first half of the year was approximately RMB 5.4 million, and the star Wu Yanzu also stopped advertising the “L2” brand.

The company officially launched L2 products to the market in July last year. The average selling price of products in spring and summer is about 25% lower than that of Lilang. In the first half of this year, L2's turnover was 35.6 million yuan, accounting for 3.4% of China Lilang's overall turnover. In addition to the cost, the net loss was about 5.4 million yuan.

But as a younger and more fashionable deputy brand that is still in cultivation, L2's future development still has great potential. China Lilang disclosed that in the autumn and winter trade fairs held in January and April of this year, the total order amount of L2 increased significantly by 135% year-on-year; at the spring-summer product order meeting for 2012, the L2 order amount increased by a year-on-year.

As of the end of June this year, L2 had 137 stores. Li Lang of China stated that it will continue to optimize and strengthen the development of the L2 brand in the second half of this year. The goal of opening the store in the whole year will be increased to 150-200 based on the current number, and it is hoped that the L2 brand will achieve its goal of balance of revenue and expenditure throughout the year.

"Lilang" brand still has a lot of room for development

In the first half of the year, the company's performance was strong. Sales in the northwest region increased 48.7% year-on-year, and the company successfully developed the Midwest market. The company’s main brand “Lilang” orders for autumn/winter 2011 will increase by 28% and 34% respectively year-on-year, and the product price will also have a double-digit increase. The spring and summer 2012 trade fair will also be gratifying and the total amount of orders will increase from the same period of last year. 28.5%, average selling price and sales volume both reached double-digit growth.