Huafu Fashion Lost 120 Million Yuan In The First Half Of The Year

On July 14, Huafu Fashion Co., Ltd. (hereinafter referred to as "Huafu fashion") disclosed its performance forecast for the first half of 2020. It is estimated that the net profit attributable to the shareholders of the listed company will lose 120 million to 160 million yuan during the reporting period.

As for the reasons for the performance change, Huafu fashion explained that during the reporting period, due to the impact of the epidemic, domestic and foreign market demand was weak, raw material prices fell, and the company's capacity utilization rate was reduced, resulting in increased costs and reduced gross profit. The company did not take measures to significantly reduce production capacity or layoffs, but actively organized staff training, improved skills and professional level, in order to wait for market recovery 。

By the end of 2019, Huafu fashion has formed five production capacity bases in Zhejiang, Huanghuai, Yangtze River, Xinjiang and Vietnam, with a total production capacity of 1880000 spindles and a production system with an annual output of 250000 tons of new yarns. The capacity expansion projects in Xinjiang and Vietnam will continue in the future. Huafu fashion is affected by the epidemic situation in the short term. The current production capacity construction speed is slowing down. The next step of production capacity construction is expected to focus on overseas, mainly in Vietnam. At the same time, Huafu fashion is also investigating Bangladesh, Pakistan and other countries.