TAIPEI, Taiwan (BRAIN) — Giant Group announced its first half consolidated sales were NT$45.01 billion ($1.5 billion ), a 7.2% increase over the first half last year.
The group's profit before tax was down 5.2% from last year. Giant said its gross margin was lowered by a higher mix of OE work, raw material cost increases and labor costs. A temporary halt at its Chinese factory also dampened margins. Profit after tax was up 2.1% to NT$3.62 billion, or earnings per share of NT$9.66.
In the second quarter, an increase in OE business and recovery of the China market drove sales performance. Consolidated quarter net sales came to NT$22.74billion, a
growth of 6.4% and company record for the quarter.
"With the unstable supply chain and suspension of China production facilities that affected the overall production utilization rate, Giant Group still managed to maintain reasonable gross margin at 24.6% but underperformed compared to the same quarter last year," the company said. Quarter profit after tax was NT$1.8billion with EPS at NT$4.8.
Giant said inventory restocking for North America and Europe has improved, especially for entry to mid-level products. It said there remained a shortage of performance-level products (an industry-wide situation that many U.S. retailers and suppliers confirm to BRAIN).
Giant said the response to last month's Tour de France showed that cycling continues to be a popular sport.
"Cycling continues to enjoy strong popularity that translates to strong growth potentials and opportunities. Especially with the increase in energy prices, bicycles are still the best alternative for consumers in both saving fuel expenses and environmental protection," Giant said.
Giant also announced this week that Donald Yu will become the company's Chief Strategy Officer effective Aug. 8.
