September 3 – Responsible for OEM for international brands such as adidas and Nike. Yue Yuen Group, which operates the manufacturing business, issued an announcement saying: Due to the severe impact of the epidemic in Vietnam, the Bao Yuen Shoe Factory in Vietnam, a subsidiary of Yue Yuen Industrial, was forced to suspend operations, and most of its manufacturing capacity and operations were interrupted. Let’s take a look at the details.
September 3 – Yue Yuen Group, which is responsible for OEM manufacturing business for international brands such as adidas and Nike, issued an announcement stating:
Severely affected by the epidemic in Vietnam, Baoyuan Shoe Factory in Vietnam, a subsidiary of Yue Yuen Industrial, was forced to suspend operations. , most manufacturing capacity and operations were disrupted.
Since the manufacturing business accounted for approximately 58% of Yue Yuen’s overall revenue in the first half of this year, Vietnam is one of Yue Yuen’s main production bases. Vietnam accounted for approximately 45% of the total pairs of shoes shipped in the first half of this year. Based on the above reasons, Yue Yuen’s manufacturing business revenue will be greatly affected in the third quarter of this year.
↑ Screenshot of Yue Yuen Group’s announcement on September 3
Baocheng further stated that in view of The epidemic in Vietnam has become more severe since July, and the local government has adopted more stringent epidemic prevention measures, including the implementation of tougher city closures in Ho Chi Minh City and its surrounding provinces. In response to relevant measures, Vietnamese competent authorities have successively required factories to suspend operations. Since the shutdown on July 14, as of September 3, most of Yue Yuen’s manufacturing capacity in Vietnam has also been affected by relevant measures, causing operations to be interrupted.
Baocheng emphasized that Yue Yuen Industrial will closely monitor the situation of business interruption in Vietnam. Taking the health and safety of employees as the premise, we actively cooperate with local government epidemic prevention regulations, maintain maximum flexibility, and restart production when conditions permit, so that operations can be carried out safely and orderly. Yue Yuen will also continue to promote measures such as workplace cleaning, work diversion and workplace control, and encourage and increase the vaccination rate of employees.
Baocheng/Fengtai was forced to suspend work and extend it again
Q3 production capacity will be greatly affected
The Vietnamese factories of shoemaking duo Baocheng and Fengtai were forced to suspend operations again due to the epidemic.
Fengtai announced on September 2 that in compliance with the Vietnamese government’s epidemic prevention requirements, the Vietnam factory The suspension of operations has been extended again to September 15, and Baocheng also announced on August 31 that the Bao Yuan Shoe Factory in Ho Chi Minh City, Vietnam, a subsidiary of Yue Yuen Industrial, will suspend operations again due to the epidemic!
The legal person stated that the shutdown time of the shoe-making duo’s Vietnam factory has been extended from mid-July to mid-September. The specific resumption time cannot be determined, and the production capacity of the two companies in the third quarter will be greatly affected. It is expected that the revenue and profits in the third quarter may be under pressure.
Among them, Fengtai Vietnam DVDPDODVMDS factory has suspended operations due to the increasingly severe epidemic in Vietnam. The shutdown started on July 17 and was extended to September 15. The shutdown period lasted for about two months.
Since the Vietnamese factory’s shoemaking capacity accounts for more than 50% of Fengtai’s global production capacity, Fengtai Thailand’s joint supply revenue in July was 5.87 billion yuan, a five-month low, and joint operating profit in July was 385 million yuan, a year-on-year decrease of 25%. The legal person said that revenue and profits in August may be affected, and the impact on third-quarter revenue is estimated to be more than 30%.
In addition, Baocheng Group also announced on 8/31 that its subsidiary Yue Yuen Industrial Its Bao Yuan Shoe Factory in Ho Chi Minh City, Vietnam, has extended its suspension of operations again in order to comply with the local government’s epidemic prevention requirements and the health and safety of colleagues. As for the resumption of work, there is no specific time, and it will follow the relevant regulations of the local Vietnamese government.
Bao Thanh Group’s Bao Nguyen shoe factory in Ho Chi Minh City has 5 employees , 60,000, which is Baocheng’s largest overseas factory. Since the epidemic in Vietnam has not cooled down, it has been suspended since July 14, and the resumption time has been repeatedly extended. Baocheng said that the shutdown of Baoyuan Shoe Factory has affected part of its production capacity, and it will coordinate with other factories in Indonesia, China, Cambodia, Myanmar, etc. to support production.
Due to Baocheng’s six factories in Vietnam, footwear production capacity accounts for half of Baocheng’s global production capacity 45% of Baocheng was forced to suspend operations on July 14, which has caused short-term operational fluctuations. In July, the joint supply revenue was 1,712.6 billion yuan, a year-on-year decrease of nearly 12%. The impact on revenue in August is expected to be more obvious in the third quarter. Overall revenue and profit performance have been put to the test.
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