Sourcing giant Li & Fung (LF) just announced its annual performance results for the 2013 fiscal year and detailed ambitious plans for expansion over the next three years.
According to the report, LF increased its core operating profit by an impressive 70 percent to $871 million, and its net profit also increased by a robust 21 percent to $755 million. Dr. William K. Fung, chairman of LF Limited, said, “2013 was a pivotal year for Li & Fung. We proved successful against uncertain external conditions, achieved strong growth, and finished the year by delivering on the promise to return to 2011 operating levels.”
LF’s brisk performance over the last year was fueled by progress made by its Distribution Network, as well as a strong showing by its Logistics Network. Profits attributable to shareholders increased by 17 percent to $725 million and the earnings per share hit $8.68, a 17 percent rise over 2012. Bruce Rockowitz, group president and CEO of LF, said:
“Overall, 2013 was a year of substantive progress and created an even stronger foundation to support our position as a global leader in our industry for years to come. We created many positive changes at LF USA which have put that part of the business back on track and we drove improvement in the Group’s overall margins and profitability even while continuing to invest in select strategic areas.”
Rockowitz also spoke enthusiastically about the positive impact LF’s success has had on the service it provides to its clients.
“I am pleased with what we accomplished over the past three years. We firmly established our Business Networks, expanded product offerings to give our customers much more choice and variety, and broadened our geographic focus largely to gain a strong foothold in Asia to capture the increasing Asia consumer spend. Today we help customers create as well as produce what they need, we manufacture it wherever they would like, and help them make purchases however it is easiest for them. We are set up to continue to play this role heading into our next Three-Year Plan.”
According to the aforementioned Three-Year Plan, LF will focus on expanding its new Vendor Services Unit, launched in January. Also, it announced the acquisition of China Container Line, “one of the largest sea freight forwarding companies in China. Rockowitz said, “Over the past three years we have navigated through an uncertain macroeconomic environment and changing global landscape. Important ‘mega trends’ have been emerging, such as a rapidly-changing retail environment which relies increasingly on multi-channel sourcing, the movement of production out of China to lower cost countries, and the need to manage risks associated with sourcing in less mature production markets. We are paying careful attention to all of this and believe we have an exciting Three-Year Plan that will enable us drive growth for the Group in both the near- and long-term.”
LF is also planning to submit an application for a potential spin-off and separate listing of its Global Brands Group on the Hong Kong Stock Exchange.
Rockowitz openly expressed his enthusiasm. “We are very excited about our new Three-Year Plan and about the new initiatives we are launching. We look forward to the many growth opportunities ahead of us.”