Chinese fashion casual menswear company Zuoan says net income for the first quarter was 73.8 million yuan (US$11.9 million), an increase of 9.5 per cent from 67.4 million yuan in the same quarter of 2012.

Revenues grew 5.8 per cent to 296.3 million (US$47.7 million).

James Hong, founder, chairman and CEO, said sales were primarily driven by growth at the distributor level and through direct stores as well as by higher average selling prices achieved as the company incorporated higher quality raw materials into its product offering.

“Our operating and net income improvements demonstrate the success of our store model transition, which helped streamline our operational infrastructure, improve productivity and reduce operating expenses.”

During the first quarter, a total of 33 distributor and sub-distributor stores were opened, resulting in a total of 1362 stores nationwide.

Hong said the company expects profitability to continue to grow as China’s consumer spending continues to stabilise and shows signs of improvement.

Approximately 20-30 new retail stores are expected to be opened in the second quarter.