 returned to profit for 2016, reversing losses racked up in previous years and causing rallies to rally on Wednesday morning.){kind=link}
Bagir Group (LON:BAGR) returned to profit for 2016, reversing losses racked up in previous years.
The clothing-maker reporting underlying earnings of $1.6 million for the year, a turnaround from $4.3 million in losses for 2015. This marked a significant improvement for the company’s finances, despite a fall in revenue to $64.1 million from $75.2 million a year previously.
However, the company noted that it had anticipated the fall, which was partly as result of a fall in sales from Marks and Spencer (LON:MKS).
Eran Itzhakof, Chief Executive of the Israel-based company commented on the promising results:
“For 2016, our target was to reverse the losses recorded in the previous year, strengthen our balance sheet, reduce costs and re-focus manufacturing on three tax and labour efficient sites. We have done this successfully and I believe we are now a stronger business than we were three years ago having been through such a rigorous process.”
“The proof now will be in our ability to win new high volume retail clients and the early signs are good having secured new contracts with H&M (STO:HM-B) and Haggar Clothing Co, new recruited customers in both the US and the EU and we are holding promising discussions with several further significant potential clients,” Itzhak continued.
2017 Outlook
Looking ahead, the company said it is looking to focus its operations across three sites in Egypt, Vietnam and Ethiopia, mostly selected for the countries’ free trade advantages. Regarding specific market focus, the company is looking to grow retail sales across the US, UK, South Africa and Australia. Last year, the company received its first new international orders from Ethiopia for H&M and Haggar Clothing Co, alongside additional customers located in the US and Europe.
Bagir Group is a clothing company that specialises in tailoring and has been in operation since 1961. Annually, it produces around 3 million units and its brand licenses include that of Austin Reed, AR RED and Jay Godfrey.
Shares in Bagir Group are up 19.25 percent as of 10.35AM (GMT).