Long-standing Duty-free Agreement with Jordan Eliminates Asian Tariff Concerns for Leading Global Brands
NEW YORK, NY / ACCESSWIRE / October 2, 2018 / Jerash Holdings (US), Inc. (NASDAQ: JRSH) (the ''Company''), a producer of high quality textile goods for leading global brands, today announced increased capacity demand indications from current customers and a growing number of trial orders from prospective customers in response to ongoing concerns over tariffs on goods produced in Asia, and specifically in China, as trade tensions continue between the US and Chinese government.
Sam Choi, Chairman of Jerash stated: ''By manufacturing in Jordan, Jerash's customers save millions in import duties each year, which we believe can be 30% or more of the cost to produce a garment item. Additionally, by choosing Jordan, our Jerash customers access a highly skilled, low cost global workforce that meets and exceeds the highest quality standards required by the best brands in the world.''
''We believe our high-quality manufacturing process makes Jerash a compelling option for garment brands throughout the world. We also believe that as a result of increasing trade tensions and rising production costs in Asia, and especially in China, our existing customers are already asking for increased capacity allocations in the year ahead, some by significant percentages,'' said Karl Brenza, Head of US Operations. ''Additionally, we are in discussions with a number of new prospective customers proactively looking for production capacity in Jordan. Several of these prospects have submitted trial orders for rapid delivery. We are currently producing those orders on expedited timelines, demonstrating the value of our unique capabilities and high-quality workforce. We are excited to work with our current and prospective customers to solve their production needs while ensuring the highest levels of quality and reducing their tariff costs.''
Jerash manufactures in a United States Qualifying Industrial Zone (QIZ) established in 2000 under then President Bill Clinton. The QIZ provides for the free movement of industrial goods between Jordan and the US provided they meet certain manufacturing and content requirements. Additionally, Jerash was recently granted an additional free trade exemption under the European Union Free Trade Area agreement established in 2002 and updated in 2018. Jerash was granted this exemption for its socially responsible initiatives surrounding the employment of Syrian refugees, becoming the first manufacturing company in Jordan to specifically recruit and employ these displaced peoples.
''While Jerash has guided for revenue growth of 15% to 18% in the current fiscal year based on increased demand from existing accounts, our current and prospective customers are submitting initial indications for even larger demand growth in the year ahead,'' said Brenza. ''These indications include transferring production of goods currently produced in other countries to Jordan, and specifically to Jerash.''
''Based on these indications and trial orders, we are accelerating our focus on new capacity expansion,'' continued Brenza. ''We presently have a plant expansion in place to add 500,000 pieces of annual production, or 8% of our current capacity. As previously disclosed, we are also seeking to augment our buildout with the acquisition of manufacturing capacity. We are currently assessing multiple facilities that may meet our exacting requirements. However, based on these newest customer demand indications, we are also now exploring joint venture and sub-contracting of additional plant capacity under Jerash supervision and control in order to meet the indicated demand from existing and new customers. Across all of these efforts, we remain focused on quality production metrics that have established Jerash as one of the best manufacturers in our category.''
About Jerash Holdings (US), Inc.
Jerash Holdings (US), Inc. (NASDAQ: JRSH) is a manufacturer utilized by many well-known brands and retailers, such as Walmart, Costco, Sears, Hanes, Columbia, Land's End, VF Corporation (which owns brands such as The North Face, Nautica, Timberland, Wrangler, Lee, Jansport, etc.), and Philip-Van Heusen (which owns brands such as Calvin Klein, Tommy Hilfiger, IZOD, Speedo, etc.). Its production facilities are made up of three factory units and two warehouses and currently employ approximately 2,900 people. The total annual capacity at its facilities is approximately 6.5 million pieces. Additional information is available at http://www.jerashholdings.com.
Forward Looking Statements
This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words ''may,'' ''would,'' ''could,'' ''will,'' ''intend,'' ''plan,'' ''anticipate,'' ''believe,'' ''estimate,'' ''expect'' and similar expressions are intended to identify forward-looking statements. Such statements reflect Jerash's current views with respect to future events and are subject to such risks and uncertainties. Many factors could cause actual results to differ materially from the statements made, including those risks described from time to time in filings made by Jerash with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. Statements contained in this news release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Jerash does not intend and does not assume any obligation to update these forward-looking statements, other than as required by law.
Contact:
Matt Kreps, Darrow Associates Investor Relations
(214) 597-8200
[email protected]
Richard J. Shaw, Chief Financial Officer
(315) 727-6791
[email protected]
SOURCE: Jerash Holdings (US), Inc.