Upholstery manufacturer Man Wah has reported a growth in profit and revenue although margins were down.

According to its fiscal year results ended 31 March, total sales rose by 28.6% to HK$21.79 billion, while net profit increased 16.8% year-on-year to HK$2.25 billion.

Despite the revenue and profit growth, net profit margin declined 1.2% to 10.5% compared with its margin of 11.7% last year.

Man Wah said that the decline was related to recent business expansion, rising prices of raw materials – with leather and wood up 24.8% and 61.2% respectively, as well as rising shipment costs and the pandemic.

The company added that raw material costs have been stabilised, while profit margin for its export business had improved over the last two months.

Wong Man Li, Man Wah Holdings Chairman and CEO, said: “We will continue to provide more diversified competitive products to give our retail partners advantages in their product assortment. We will also continue our commitment to sustaining the highest quality standards in manufacturing.

“This past year has been challenging because of issues outside of our control. However, I believe that adversity makes a good company stronger. Man Wah will continue to improve our company from the inside out so we can continue to better support our customers.”