HONG KONG Aug 6 Chinese shoe manufacturer Yue
Yuen Industrial Holdings Ltd, hit by strikes this
year, said it expected to book a $112 million provision to
improve employee benefits that would have a material impact on
its first-half results.
The amount is bigger than a preliminary estimate made in May
of a $37 million provision for an employee benefit programme at
its Gaobu factory. Yue Yuen, which is controlled by
Taiwan-listed Pou Chen Corp, said it had decided to
improve benefits at its other factories in China as well.
Thousands of Yue Yuen workers staged one of China's biggest
strikes this year. They agreed to go back to work in April after
the maker of footwear for companies such as Nike Inc and
Adidas agreed to meet some of their demands for
"The main reasons for making the employee benefit
contributions are to assist the group in staff retention and
recruitment under the increasingly competitive labor market
conditions in China so as to ensure the group's normal business
operation and production in the other factories," Chairman Lu
Chin Chu said in the statement.
The company posted $194.5 million in net profit in the first
six months of last year. It is due to announce first-half
earnings on August 13.
(Reporting by Donny Kwok; Editing by Edwina Gibbs)