Fashion
South East Asia year-end review 2025: Minnows under heat
In addition, strategic competition between the US and China adds complexity to the situation because many South East Asian garment factories depend on raw materials from China. Now they are under pressure to reduce this reliance while maintaining trade ties with both economic superpowers. The impact is felt most strongly by women in these countries. Around 70 per cent of garment workers are female, and the new tariffs threatened their already low income. Job losses directly affect the survival of their families.
Myanmar
Smaller garment-producing economies like Myanmar, Thailand and Laos came under intense pressure from steep US tariffs and shifting geopolitics.
Tariff hikes disrupted factory orders, accelerated closures, and threatened livelihoods.
Exporters were left to scramble for alternative markets, push trade negotiations, and rethink supply chains amid rising costs and dependence on China.
The 40-per cent tariffs on Myanmar exports took a heavy toll on the country’s garment industry, with foreseeable shut down of several factories. The tariff came into effect on August 1, and since then orders dropped sharply, leading to job losses, fewer overtime hours and eventual factory closures – at least four in the industrial zones of Yangon’s Hlaing Tharyar and Shwepyithar townships alone. The first to shut down was Twinkle (Myanmar), a factory that used to manufacture garments for US-based Callaway Golf and luggage maker Samsonite. Other closures included SDI Manufacture, Wan Xin Myanmar, and Eternal Fashion. In the past, factory closures used to be caused by electrical problems, raw material shortages or road closures but lately tariff became the major contributing factor. Over 700,000 workers are employed in Myanmar’s garment factories, with double that number in related industries. An estimated four times that number of family members depend on their wages, according to the Myanmar Garment Manufacturers Association (MGMA).
To counter the effects of the tariffs, some factories that previously catered to the US market started seeking orders from Japan, South Korea, and the EU.
Alongside the high tariff, Myanmar also faced heat from the ILO (International Labour Organisation) over violations of agreements related to workers’ rights, such as freedom of association and the elimination of forced labour.
Thailand
Thailand’s tryst with US reciprocal tariff began with imposition of 36 per cent rate on April 2. However, after successful negotiations, the US reduced reciprocal tariff on Thai goods to 19 per cent starting August 1. In September, Thai garment exporters called on the new government to pause wage hikes and accelerate EU FTA talks, noting that garments remain a labour-intensive sector employing some 600,000- 800,000 workers. Rising wages to 400 baht per day would disproportionately affect new and unskilled workers whose productivity remains low, also increasing costs for employers. In Thailand, labour and raw material expenses make up 60-70 per cent of total production costs for garment manufacturers. Since the US accounts for approximately 40 per cent of Thailand’s garment exports, the increased US tariff, up from an average 10 per cent to 29 per cent, threatened this key market. On the other hand, Thai exporters face EU tariffs averaging 10-20 per cent depending on the garment type, so securing an FTA with the EU was seen as an opportunity to open up trade with 27 countries, which will help in offsetting potential losses in the US market.
Laos
Although the European Union, especially Germany, has been the main destination for Laotian textiles, the US has long been among the top five export markets. This is when Laos exports to US is relatively small comprising a small number of factories which supply the American market. Driven by US trade deficit of over $760 million with Laos, US administration imposed one of the highest tariff charges of 40 per cent on the small Asian nation. To complicate things further for Laos, its supply chains are closely tied to China. The high tariff is estimated to effect around 20,000 or more out of nearly 30,000 workers which the garment industry employs, while representing around 13 per cent of export earnings, excluding natural resources. This number rises in case of companies’ closure. If US customers pull back, an estimated 35 to 40 factories may face disruption.
Laos is a regional base for garment manufacturing that supplies to many western brands. Production of mattresses is among the various segments that are severely affected by the tariffs. In recent times, the country has benefitted with the success of the China–Laos Railway, which has transformed Laos from a landlocked state into a regional logistics hub, significantly reducing shipping times and costs.
Fibre2Fashion News Desk (SB)
The annual gross margin improved by 220 basis points to 57.6 per cent, while operating profit jumped 49 per cent to $702 million. Operating margin expanded 160 basis points to 10.7 per cent, reflecting strong profitability gains across segments. Net income attributable to equity holders increased 489 per cent to $427 million, or $0.76 per diluted share, with adjusted net income rising 131 per cent to $545 million, or $0.97 per diluted share.
Amer Sports has reported FY25 revenue growth of 27 per cent to $6,566 million with margin expansion and strong profitability across segments.
Q4 revenue rose 28 per cent to $2,101 million, driven by Technical Apparel and Outdoor Performance.
Despite higher growth investments, earnings surged and outlook remains positive, with the company projecting double-digit growth momentum into 2026.
Meanwhile, in the fourth quarter (Q4), the company recorded revenue of $2,101 million, up 28 per cent YoY, exceeding guidance and reflecting continued momentum across its portfolio. Segment-wise, Technical Apparel revenue rose 34 per cent to $1 billion, Outdoor Performance increased 29 per cent to $764 million, and Ball & Racquet Sports grew 14 per cent to $337 million, Amer Sports said in a press release.
The gross margin improved by 160 basis points to 57.7 per cent in Q4, while adjusted gross margin reached 57.8 per cent. Selling, general and administrative expenses increased 35 per cent to $988 million amid accelerated investments, particularly to support Salomon Softgoods growth initiatives. Operating profit climbed 18 per cent to $228 million, although operating margin declined around 90 basis points to 10.9 per cent due to higher growth investments.
Net income attributable to equity holders surged 752 per cent to $132 million in the quarter, translating to diluted earnings per share of $0.23, while adjusted net income rose 94 per cent to $176 million, or $0.31 per diluted share.
James Zheng, chief executive officer (CEO) of Amer Sports said, “Fourth quarter was a great finish to a breakout year for Amer Sports led by our flagship Arc’teryx brand and rising star Salomon, which surpassed the $2 billion sales mark. In 2025 we delivered 27 per cent revenue growth and more than 150 basis points of operating margin expansion, with double-digit growth across all segments, regions, and channels.”
Zheng added that he was pleased to announce Carrie Ask as the next Wilson President and CEO, describing her as a proven brand leader and C-suite executive with strong prior experience at Helly Hansen, Levi’s and Nike.
“Looking forward, we believe our unique portfolio of technical sports and outdoor brands is very well positioned for strong and profitable growth within the premium sports and outdoor market, which continues to be one of the healthiest segments across the global consumer landscape,” added Zheng.
Andrew Page, chief financial officer of the company, highlighted the group’s financial strength and investment strategy, stating: “We had another strong performance in Q4 with healthy sales growth, gross margin expansion and EPS despite our decision to accelerate investment behind Salomon. The strong sales and profitability profile of the broader Amer portfolio gives us the flexibility to accelerate resources behind the large Salomon Softgoods opportunity while still delivering great results at the Group level.”
He added, “Ending 2025 with only 0.3x net leverage and more than $700 million operating cash flow, we believe our financial foundation has never been stronger. Looking ahead, given the continued momentum from our highest-margin Arc’teryx franchise, accelerating Salomon footwear growth, plus the solid foundation of our equipment franchises, we are confident in our ability to deliver another strong financial performance in 2026.”
Looking ahead, Amer Sports expects FY26 reported revenue growth of 16-18 per cent, supported by favourable foreign exchange conditions, with gross margin projected at around 59.0 per cent and operating margin between 13.1 and 13.3 per cent. The company also anticipates continued segment growth, led by Technical Apparel and Outdoor Performance, alongside steady expansion in Ball & Racquet Sports.
For the first quarter (Q1) of 2026, Amer Sports forecasts reported revenue growth of 22-24 per cent, with operating margin expected between 14 and 14.5 per cent, underscoring sustained momentum as the company advances its growth strategy across premium sports and outdoor categories.
Fibre2Fashion News Desk (SG)
The gross margin for the quarter stood at 41.3 per cent of net sales, slightly below 41.5 per cent a year earlier. The marginal decline reflected tariff-driven pressure on wholesale margins, partially offset by improved retail profitability and a higher retail sales mix. Operating expenses increased to $48.1 million, or 34.5 per cent of net sales, mainly due to higher logistics costs linked to retail growth as well as increased incentive compensation and discretionary spending.
Rocky Brands has posted net sales of $139.7 million in Q4 2025, up 9.1 per cent YoY, driven by a 30.8 per cent surge in retail sales, while wholesale and contract manufacturing declined.
Net income rose 35.7 per cent to $6.5 million.
Full-year sales grew 6.2 per cent to $482 million with improved margins and profitability, supported by strong DTC demand despite tariff pressures.
Income from operations increased 12.8 per cent to $9.6 million, representing 6.9 per cent of net sales, compared with $8.5 million in the prior-year quarter. Net income rose sharply by 35.7 per cent to $6.5 million, or $0.86 per diluted share, versus $4.8 million, or $0.64 per diluted share, a year earlier, Rocky Brands said in a press release.
Adjusted net income for the quarter was $7.2 million, or $0.94 per diluted share, compared with $8.9 million, or $1.19 per diluted share in the corresponding period of 2024. Interest expense declined to $2.5 million from $3 million due to lower debt levels and easing interest rates.
For the full year 2025, Rocky Brands recorded net sales of $482 million, up 6.2 per cent from $453.8 million in 2024. Wholesale sales grew modestly by 1 per cent to $316.6 million, while retail sales climbed 20.5 per cent to $152.9 million, highlighting the continued shift towards direct-to-consumer (DTC) channels. Contract manufacturing revenue declined 7.7 per cent to $12.5 million.
Annual gross margin improved significantly by 150 basis points to 40.9 per cent, driven by stronger wholesale profitability and favourable channel mix. Operating expenses totalled $160.1 million, or 33.2 per cent of net sales, reflecting investments to support growth initiatives. Income from operations increased 19.7 per cent to $37.2 million, representing 7.7 per cent of net sales.
Net income for 2025 nearly doubled to $22.3 million, or $2.96 per diluted share, compared with $11.4 million, or $1.52 per diluted share in 2024. Adjusted net income reached $24.5 million, or $3.26 per diluted share, up from $19.0 million, or $2.54 per diluted share the previous year. Interest expense declined to $10.0 million following debt refinancing in April 2024 and continued deleveraging, with total debt falling to $122.6 million at year-end from $128.7 million in 2024.
“We concluded 2025 with our highest quarterly net sales growth rate for the year in the fourth quarter, reflecting the momentum that has been building in our business,” said Jason Brooks, chairman, president and CEO at Rocky Brands. “Our performance during the key holiday selling season was highlighted by strong demand in our direct-to-consumer channel led by XTRATUF, which delivered nearly triple digit sales growth online. These results contributed to a very good year for our Company, especially considering the industry headwinds caused by higher tariffs and deteriorating US consumer sentiment.”
Fibre2Fashion News Desk (SG)
The components division generated CHF 193.5 million (~$249.6 million) in orders amid cautious investment in new machinery, while the After Sales division posted a 6 per cent increase to CHF 163.6 million, supported by expanded service networks and stronger activity in Central Asia and China.
Rieter has reported stable 2025 order intake of CHF 703.4 million (~$907.4 million) despite market uncertainty, while sales fell 20 per cent to CHF 685.1 million (~$883.8 million).
Cost controls delivered positive operating EBIT, but Barmag-related charges led to a net loss.
The Barmag acquisition expands fibre capabilities.
For 2026, Rieter projects CHF 1.3-1.5 billion ($1.68-1.94 billion) sales.
Group sales declined 20 per cent YoY to CHF 685.1 million (~$883.8 million) from CHF 859.1 million, reflecting subdued market demand. Sales in Machines and Systems dropped 23 per cent to CHF 329.1 million, Components fell 19 per cent to CHF 200.8 million, and After Sales decreased 17 per cent to CHF 155.2 million. Order backlog stood at around CHF 510 million at the end of 2025, Rieter said in a press release.
Despite weaker sales, Rieter achieved a positive operating EBIT of CHF 2.5 million through cost control measures. However, restructuring expenses and transaction costs related to the Barmag acquisition, totalling CHF 54.2 million, resulted in a net loss of CHF 63.4 million for the year compared with a net profit of CHF 10.4 million in 2024. Free cash flow turned negative at CHF 40.6 million, although net liquidity improved to CHF 184.3 million following a capital increase completed in October 2025.
Given the negative earnings, the board has proposed no dividend distribution while reaffirming its long-term policy of paying at least 40 per cent of net profit. The equity ratio strengthened to 53.3 per cent at the end of 2025, reflecting the capital raise linked to the acquisition.
Rieter completed the acquisition of Barmag on February 2, 2026, integrating the business as its new Man-Made Fiber Division. The move expands the company’s capabilities beyond short-staple fibre machinery, positioning it as a system supplier across natural and man-made fibre processing and strengthening technological capabilities in automation and digitisation.
The company expects at least CHF 20 million in synergies from the acquisition and has outlined new medium-term scenarios. Depending on market conditions, annual sales could range from CHF 1.4 billion with 2-5 per cent operating margins in a subdued environment to CHF 2.2 billion with margins of 8-11 per cent under strong demand.
For 2026, which Rieter described as a transition year, the group forecasts sales between CHF 1.3 billion and CHF 1.5 billion ($1.68-1.94 billion) and a positive operating EBIT margin of 0-3 per cent as integration and restructuring initiatives progress. Financing for the combined entity’s development is fully secured.
Fibre2Fashion News Desk (SG)
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