by HIGH POINT — Samson Holding, the parent company of Samson Marketing Group that includes Baker, Universal, Legacy Classic/Modern and Craftmaster, announced plans to establish another factory in Vietnam this year.
The company revealed a glimpse of the plans in its annual financial report released just before the April High Point Market.
The report did not say whether the company plans to build a new facility or purchase a new plant. It also did not reveal specifics on the type of product it would produce either in case goods or upholstery.
However, Samson noted that another facility would expand on its capabilities in Vietnam, where it produces bedroom, dining and occasional furniture. It also produces a line of casual dining in Bangladesh.
The company’s operations in Vietnam include a majority ownership stake in case goods manufacturer Timber Inds. located in the Dong Nai Province. Samson made this acquisition in mid-2019 to reduce its exposure to tariffs on goods shipped from its China-based manufacturing facilities.
“With a globalized supply chain, Samson has built up stronger production capabilities to cope with geopolitical instabilities and improve cost controls,” company Chairman Samuel Kuo said in the annual report. “Samson’s capacity across the Asia region including Vietnam and Bangladesh was enhanced through factory investment and acquisition in the last three years, which will further facilitate the overall product delivery efficiency.”
The company reported overall net sales for 2021 totaled $488.1 million, up 22.8% from the $397.6 million reported in 2020. It posted a $27.2 million profit, compared to a loss of $15.7 million in 2020.
The company did not reveal specific numbers for each of its U.S. brands but noted that net sales at Universal and Legacy were up double digits and that Baker’s operating profit improved during the year.
Samson attributed the increase in net sales to strong consumer demand during the pandemic.
“The Group was able to capture the opportunity for further market penetration through its diverse product offerings and multi-distribution channels,” Kuo added. “For the traditional channel, the demand from offline stores and the mass merchants continued to rise as the impacts from the COVID-19 have eased.”
“On the demand side, the upholstery and case goods business remained strong, and the demand from the hospitality channel is expected to increase in the first quarter of 2022,” Kuo added. “On the supply side, as the logistic costs showed an upward trend resulting from an increased delivery expense, Samson has partnered with several shipping service providers to ensure container availability and cost reductions.”
For example, the report said, the company reduced its overall operating expenses from $121.5 million in 2020 to $117.5 million in 2021, which Kuo attributed to a series of cost control measures.
The company also has a strong cash position, which adds further credibility to the expansion plans in Vietnam. As of Dec. 31, its cash and cash equivalents rose by $39 million to $65 million.
“The Group possesses sufficient cash and available banking facilities to meet working capital requirements and to enable further acquisitions with confidence,” Kuo said, noting that the company also spent $4.8 million in capital expenses last year to upgrade and renovate property, plants and machinery in the U.S. and to expand new production lines in the U.S. and Vietnam.
The further expansion in Vietnam, he noted, will work hand in hand with its other existing manufacturing capabilities to grow its business over time.
“With a global manufacturing base, experienced management team and improving efficiencies and core competitiveness, Samson is expected to keep increasing the capacity and profitability,” Kuo said. “Combining its successful strategy of supply chain and diversified brands, Samson is well-positioned to maintain its competitive edges and continue to expand market share in the U.S., bringing fruitful results for 2022.”
