LJ International's ENZO Division Continues Rapid Expansion Across China with 13 Stores Now Profitable
June 29 2006 - 12:00PM
PR Newswire (US)
Company Expects to Increase Second Quarter Guidance HONG KONG and
LOS ANGELES, June 29 /Xinhua-PRNewswire-FirstCall/ -- LJ
International, Inc. (LJI) (NASDAQ:JADE), one of the fastest-growing
jewelry companies in the world, today reported on the continuing
expansion of its ENZO Division, the Company's retail jewelry chain
launched following China's acceptance into the World Trade
Organization (WTO). The report indicated that LJI's ENZO Division
is continuing to exceed all internal and external expectations on
both an operational and financial basis. The Company indicated
that: -- ENZO has 30 stores in operation as of today, well ahead of
its schedule to open at least 40 stores by the end of 2006. It is
also now well-established in all major regions and metropolitan
areas of Mainland China, Hong Kong and Macau. -- Of the 30 stores
in operation as of today, 13 have already achieved profitability on
a store level. -- Based on these trends, the Company believes that
it is well on-track to continue to strengthen its position as one
of the dominant jewelry brands in China. Founded just over 18
months ago, ENZO has rapidly grown to become the largest
foreign-branded retail jewelry chains in China. With six months
remaining in the current year, ENZO is only ten stores shy of its
publicly stated 40 store target for the end of 2006. Overall, as
reported earlier by LJI, total revenue from the ENZO division in
the first quarter ended March 31, 2006, was $1.76 million, up 66%
sequentially from $1.06 million in the fourth quarter of 2005.
ENZO's net loss (including operating and finance expenses for new
store openings) declined to $550,000 in the first quarter of 2006
from $749,000 in the fourth quarter of 2005. LJI expects ENZO to
reach break-even EBITDA (earnings before interest, taxes,
depreciation and amortization) during 2006, with profitability
expected the following year. Yu Chuan Yih, Chairman and CEO of LJ
International, commented, "The financial growth of our ENZO retail
stores in only its first 18 months of operation confirms the
brand's strong market acceptance in the Chinese retail jewelry
market. It is also growing at such a rapid pace that it will likely
emerge as one of the primary drivers of LJI's future financial
growth faster than initially expected. ENZO's current store opening
schedule, which is well ahead of schedule, successful advertising
and marketing campaigns and the growing Chinese economy has already
enabled over 40% of the total number of stores to achieve
profitability on the store level -- nearly half a year ahead of our
initial expectations. As a result, we believe ENZO will positively
impact both our current second quarter and the remainder of the
year better than expected." The Company expects to increase its
second quarter guidance as a result of the continuing better than
expected performance both in its wholesale and retail businesses.
To be added to the LJI's investor lists or to participate in any
upcoming institutional investor meetings, please contact Haris
Tajyar at or at 818-382-9700. About LJ International Inc. LJ
International Inc. (LJI) (NASDAQ:JADE), based in Hong Kong and the
U.S., is engaged in the designing, branding, marketing and
distribution of a full range of jewelry. It has built its global
business, currently one of the fastest-growing in the jewelry
industry, on a vertical integration strategy and an unwavering
commitment to quality and service. LJI distributes to fine
jewelers, department stores, national jewelry chains and electronic
and specialty retailers throughout North America and Western
Europe, with a growing retail presence in China through its ENZO
stores. Its product lines incorporate all major categories sought
by major retailers, including earrings, necklaces, pendants, rings
and bracelets. For more information on LJI, please visit
http://www.ljintl.com/ . Forward looking statement: Except for the
historical information, the matters discussed in this news release
may contain forward-looking statements, including, but not limited
to, factors relating to future revenues. These forward-looking
statements may involve a number of risks and uncertainties. Actual
results may vary significantly based on a number of factors,
including, but not limited to, uncertainties in product demand, the
impact of competitive products and pricing, changing economic
conditions around the world, release and revenues of new products
and other risk factors detailed in the company's most recent annual
report and other filings with the Securities and Exchange
Commission. For further information: AT LJI: AT INVESTOR RELATIONS
INTL: Betty Ho Haris Tajyar Vice President, Corporate Development
Managing Partner Ph: 011-852-2170-0001 Ph: 818-382-9702 Email:
Email: DATASOURCE: LJ International, Inc. CONTACT: Betty Ho of LJ
International, +852-2170-001, or ; Haris Tajyar of Investor
Relations Intl for LJ International, +1-818-382-9702 or Web site:
http://www.ljintl.com/
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