US furniture designer, manufacturer and distributor Nova LifeStyle sees China as a key growth market as it feels a pinch in Europe.
The company finished 2014 recording a 26 per cent year-on-year increase in net sales to US$98.7 million, with growth was primarily driven by a 46 per cent increase in sales in North America and 14 per cent in Asia Pacific, partially offset by a 20 per cent decline in Europe.
Its gross profit was $19.4 million, also an increase of 26 per cent. Net income for the California-based, Nasdaq-listed company was $8.6 million.
In China, overall sales increased by six per cent to $17 million, largely due to the opening of seven new franchised stores in the nation.
“Throughout 2014, Nova LifeStyle implemented strategic initiatives to expand sales and distribution in China, a key growth market,” the company said in its earnings statement.
Nova LifeStyle boosted sales on Alibaba’s B2C sites, TMall and JD.com and signed a franchise partnership with the Ablejoy Company of China, to provide Nova products to its 200-strong retail store network.
Nova LifeStyle initiated shipping to Ablejoy in the third quarter of 2014 and will continue to supply current and future franchise stores. The company also successfully began manufacturing and shipping to Ikea China.
Sales in other parts of Asia Pacific, including Hong Kong, Australia, and other countries, increased 46 per cent to $5.89 million in 2014.
The company said it expects the China and US markets to contribute to top-line growth in the year ahead.
“Sales in Asia increased significantly and we view the supply agreement with Ikea China as a testament to the quality of our products and manufacturing capabilities,” said CEO Jeffrey Wong.
“We are witnessing the expansion of the retail furniture market in China as the growing middle class, increasing urbanisation and increased consumer spending fuel higher demand for household goods and furniture.
“Due to our efforts in 2014, we believe that Nova LifeStyle is well positioned to take full advantage of any upturns in the global economy, both in Asia and in the domestic market,” concluded Wong.
Nova’s products are made in the US, Europe, and Asia and include LifeStyle brands such as Diamond Sofa, Colorful World, Giorgio Mobili, Nova QwiK, and Bright Swallow International.
