10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the transition period from ____________ to ____________

Commission file number:  0-28806

Ever-Glory International Group Inc.

(Exact name of registrant as specified in its charter)

Florida	65-0420146
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

Ever-Glory Commercial Center,

509 Chengxin Road, Jiangning Development Zone,

Nanjing, Jiangsu Province,

People’s Republic of China

(Address of principal executive offices)

(8625) 5209-6875

 (Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x  No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   x Yes  o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. o

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o  No x

As of August 7, 2013, 14,777,610 shares of the Company’s common stock, $0.001 par value, were issued and outstanding.

EVER-GLORY INTERNATIONAL GROUP, INC.

FORM 10-Q

INDEX

		Page Number
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		3
PART I.  FINANCIAL INFORMATION		4
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets as of June 30, 2013 (unaudited) and December 31, 2012	4
	Condensed Consolidated Statements of Comprehensive Income for the Six Months Ended June 30, 2013 and 2012 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2013 and 2012 (unaudited)	6
	Notes to the Condensed Consolidated Financial Statements (unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29
PART II.  OTHER INFORMATION		30
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	30
Item 4.	Mine Safety Disclosures	30
Item 5.	Other Information	30
Item 6.	Exhibits	30
SIGNATURES		31

Cautionary Note Regarding Forward-Looking Statements

Statements contained in this Quarterly Report on Form 10-Q, which are not historical facts, are forward-looking statements, as the term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, whether expressed or implied, are subject to risks and uncertainties which can cause actual results to differ materially from those currently anticipated, due to a number of factors, which include, but are not limited to:

● Competition within our industry;

● Seasonality of our sales;

● Success of our investments in new product development

● Our plans and ability to open new retail stores;

● Success of our acquired businesses;

● Our relationships with our major customers;

● The popularity of our products;

● Relationships with suppliers and cost of supplies;

● Financial and economic conditions in Asia, Japan, Europe and the U.S.;

● Anticipated effective tax rates in future years;

● Regulatory requirements affecting our business;

● Currency exchange rate fluctuations;

● Our future financing needs; and

● Our ability to attract additional investment capital on attractive terms.

Forward-looking statements also include the assumptions underlying or relating to any of the foregoing or other such statements. When used in this report, the words “may,” “will,” “should,” “could,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “continue,” and similar expressions are generally intended to identify forward-looking statements.

Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date hereof. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements. Readers should carefully review the factors described in the Section entitled “Risk Factors” on Form 10-K and other documents we file from time to time with the Securities and Exchange Commission (‘SEC’).

3

PART I.  FINANCIAL INFORMATION

ITEM 1. Financial Statements

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2013 (UNAUDITED) AND DECEMBER 31, 2012

ASSETS

	June 30, 2013				December 31, 2012
CURRENT ASSETS
Cash and cash equivalents		$	16,136,753			$	9,365,958
Accounts receivable			49,748,625				68,513,893
Inventories			56,697,298				46,038,456
Value added tax receivable			4,107,991				2,866,018
Other receivables and prepaid expenses			1,478,315				1,910,383
Advances on inventory purchases			5,313,877				3,596,860
Amounts due from related parties			2,405,039				8,680
Total Current Assets			135,887,898				132,300,248
LAND USE RIGHT, NET			2,823,135				2,801,472
PROPERTY AND EQUIPMENT, NET			17,352,513				16,068,735
TOTAL ASSETS		$	156,063,546			$	151,170,455
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Bank loans		$	44,823,302			$	46,919,680
Payble to officers and employees			-				2,341,574
Accounts payable			41,120,018				49,700,392
Accounts payable and other payables - related parties			3,374,320				3,158,814
Other payables and accrued liabilities			10,839,202				10,547,190
Value added and other taxes payable			4,198,504				4,189,211
Income tax payable			581,282				952,652
Deferred tax liabilities			3,731,695				3,109,095
Derivative liability		-					294,000
Total Current Liabilities			108,668,323				121,212,608
COMMITMENTS AND CONTINGENCIES
EQUITY
Stockholders' equity of the Company:
Preferred stock ($.001 par value, authorized 5,000,000 shares,
no shares issued and outstanding)			-				-
Common stock ($.001 par value, authorized 50,000,000 shares,
14,777,610 and 14,772,270 shares issued and outstanding
as of June 30, 2013 and December 31, 2012, respectively)			14,777				14,772
Additional paid-in capital			3,562,243				3,552,166
Retained earnings			52,588,291				46,774,001
Statutory reserve			6,317,715				6,317,715
Accumulated other comprehensive income			8,031,562				6,873,170
Amounts due from related party			(23,119,365	)			(33,573,977	)
Total Stockholders' Equity			47,395,223				29,957,847
TOTAL LIABILITIES AND EQUITY		$	156,063,546			$	151,170,455

See the accompanying notes to the consolidated financial statements.

4

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2013 AND 2012 (UNAUDITED)

		Three months ended						Six months ended
		June 30,						June 30,
		2013			2012			2013			2012
NET SALES	$	59,129,485		$	47,195,031		$	137,440,975		$	100,421,204
COST OF SALES		39,650,917			33,608,450			97,669,484			75,231,635
GROSS PROFIT		19,478,568			13,586,581			39,771,491			25,189,569
OPERATING EXPENSES
Selling expenses		9,898,106			6,966,335			21,749,402			12,800,527
General and administrative expenses		5,513,105			4,198,130			9,985,552			7,203,406
Total Operating Expenses		15,411,211			11,164,465			31,734,954			20,003,933
INCOME FROM OPERATIONS		4,067,357			2,422,116			8,036,537			5,185,636
OTHER INCOME (EXPENSES)
Interest income		342,188			328,736			637,790			610,220
Interest expense		(736,695	)		(458,703	)		(1,528,224	)		(1,004,744	)
Change in fair value of derivative liability		2,000			180,000			294,000			290,800
Other income (expenses)		(179,098	)		200,010			(147,641	)		236,313
Total Other Income (Expenses)		(571,605	)		250,043			(744,075	)		(132,589	)
INCOME BEFORE INCOME TAX EXPENSE		3,495,752			2,672,159			7,292,462			5,318,225
INCOME TAX EXPENSE		(768,541	)		(321,010	)		(1,478,172	)		(845,866	)
NET INCOME		2,727,211			2,351,149			5,814,290			4,472,359
OTHER COMPERHENSIVE (LOSS) INCOME
Foreign currency translation (loss) gain		850,550			(196,365	)		1,158,392			200,001
COMPREHENSIVE INCOME	$	3,577,761		$	2,154,784		$	6,972,682		$	4,672,360
EARNINGS PER SHARE
Basic and diluted	$	0.18		$	0.16		$	0.39		$	0.30
Weighted average number of shares outstanding
Basic and diluted		14,777,610			14,765,942			14,775,869			14,763,815

See the accompanying notes to the condensed consolidated financial statements.

5

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2013 AND 2012 (UNAUDITED)

	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,814,290		$	4,472,359
Adjustments to reconcile net income to cash provided
by operating activities:
Depreciation and amortization		3,690,891			2,296,910
Recovery (Provision) for obsolete inventories		(315,354	)		459,213
Loss from sale of property and equipment		29,499			-
Change in fair value of derivative liability		(294,000	)		(290,800	)
Deferred income tax		555,716			563,191
Stock-based compensation		10,082			9,836
Changes in operating assets and liabilites
Accounts receivable		19,994,644			14,295,016
Inventories		(9,415,298	)		(2,219,405	)
Value added tax receivable		(1,177,837	)		(1,591,861	)
Other receivables and prepaid expenses		307,455			(295,199	)
Advances on inventory purchases		(1,473,254	)		(555,284	)
Amounts due from related parties		(2,760,288	)		10,848,191
Accounts payable		(9,577,345	)		(8,594,380	)
Accounts payable and other payables- related parties		123,426			(80,515	)
Other payables and accrued liabilities		75,308			36,570
Value added and other taxes payable		(77,745	)		(32,117	)
Income tax payable		(389,778	)		(90,383	)
Net cash provided by operating activities		5,120,412			19,241,223
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		(4,642,650	)		(2,147,918	)
Proceeds from sale of property and equipment		13,583			-
Net cash used in investing activities		(4,629,067	)		(2,147,918	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from bank loans		42,227,892			24,576,457
Repayment of bank loans		(45,290,965	)		(31,488,282	)
Repayment of payble to officers and employees		(2,381,512	)		-
Repayment of advances to related party		18,781,438			-
Advances to related party		(7,244,771	)		(11,794,260	)
Net cash (used in) provided by financing activities		6,092,082			(18,706,085	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH		187,368			(25,764	)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		6,770,795			(1,638,544	)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		9,365,958			8,822,581
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	16,136,753		$	7,184,037
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	1,528,224		$	1,004,744
Income taxes	$	1,199,771		$	373,221

See the accompanying notes to the condensed consolidated financial statements.

6

 EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2013 AND 2012

(UNAUDITED)

NOTE 1   BASIS OF PRESENTATION

Ever-Glory International Group, Inc. (the “Company”), together with its subsidiaries, is an apparel manufacturer, supplier and retailer in The People's Republic of China ("China or "PRC"), with a wholesale segment and a retail segment. The Company’s wholesale business consists of recognized brands for department and specialty stores located in China, Europe, Japan and the United States. The Company’s retail business consists of flagship stores and store-in-stores for the Company’s own-brand products.

The Company’s wholesale operations are provided primarily through the Company’s wholly-owned PRC subsidiaries, Goldenway Nanjing Garments Co. Ltd. (“Goldenway”), Nanjing Catch-Luck Garments Co. Ltd. (“Catch-Luck”), Nanjing New-Tailun Garments Co. Ltd (“New-Tailun”), Ever-Glory International Group Apparel Inc.(“Ever-Glory Apparel”) and Nanjing Tai Xin Garments Trading Company Limited (“Tai Xin”), and the Company’s wholly-owned Samoa subsidiary, Ever-Glory International Group (HK) Ltd. (“Ever-Glory HK”).  The Company’s retail operations are provided through its wholly- owned subsidiary, Shanghai LA GO GO Fashion Company Limited (“LA GO GO”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements of the Company and its subsidiaries contain all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the condensed consolidated balance sheet as of June 30, 2013, the condensed consolidated statements of comprehensive income for the three and six months ended June 30, 2013 and 2012, and the condensed consolidated statements of cash flows for the six months ended June 30, 2013 and 2012. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Accordingly, they have been condensed and do not include all of the information and footnotes required by GAAP for complete financial statements. Wholesale revenues are generally higher in the third and fourth fiscal quarters, while retail revenues are generally higher in the first and fourth fiscal quarters. The results of operations for the six months ended June 30, 2013 are not necessarily indicative of the results of operations to be expected for the full fiscal year. These financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, and the Company's June 30, 2012, amended Form 10Q/A filed on May 15, 2013.

NOTE 2   SIGNIFICANT ACCOUNTING POLICIES

Financial Instruments

Management has estimated that the carrying amounts of non-related party financial instruments approximate their fair values due to their short-term maturities. The fair value of amounts due from (to) related parties is not practicable to estimate due to the related party nature of the underlying transactions.

7

Fair Value Accounting

Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2	Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
Level 3	Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

At June 30, 2013, the Company’s financial assets (all Level 1) consist of cash placed with financial institutions that management considers to be of a high quality.

At December 31, 2012 and through mid June 2013, the Company had a derivative liability subject to recurring fair value measurement ( Level 3) with the change in fair value recognized in earnings (Note 6).

Foreign Currency Translation and Other Comprehensive Income

The reporting currency of the Company is the U.S. dollar. The functional currency of the Company, Ever-Glory HK and Perfect Dream Limited, a British Virgin Islands incorporated subsidiary of the Company (“Perfect Dream”), is the U.S. dollar. The functional currency of Goldenway, New Tailun, Catch-luck, Ever-Glory Apparel, Tai Xin and LA GO GO is the Chinese RMB.

For subsidiaries whose functional currency is the RMB, all assets and liabilities were translated at the exchange rate at the balance sheet date; equity was translated at historical rates and items in the statement of comprehensive income were translated at the average rate for the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income. The resulting translation gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Items in the cash flow statement are translated at the average exchange rate for the period. 

NOTE 3   INVENTORIES

 Inventories at June 30, 2013 and December 31, 2012 consisted of the following:

	June 30, 2013			December 31, 2012
Raw materials	$	13,212,328		$	5,687,612
Work-in-progress		14,125,834			7,296,733
Finished goods		32,836,826			36,770,852
		60,174,988			49,755,197
Less: allowance for obsolete inventories		(3,477,690	)		(3,716,741	)
Total inventories	$	56,697,298		$	46,038,456

Note 4       PAYABLE TO OFFICERS AND EMPLOYEES

The Company established a plan in September 2012. Under this plan, eligible employees may make loans to the Company and earn interest equal to prevailing China bank loan interest rates, normally two to four times rates on savings accounts. The loans could be made only in the period from September 1, 2012 to December 31, 2012. The annual interest rate varies in line with changes in China bank loan interest rates. During the period from September 1, 2012 to June 30, 2013, the average loan interest rate was 6.0% and the total interest expense for the three and six-month periods ended June 30, 2013 was $21,817 and $57,118 respectively.  The total balance of $2,381,512 was repaid to the officers and employees during the three months ended June 30, 2013.

8

NOTE 5   BANK LOANS

Bank loans represent amounts due to various banks and are generally due on demand or within one year. These loans can be renewed with the banks. Bank loans consisted of the following at June 30, 2013 and December 31, 2012:

Bank	June 30, 2013		December 31, 2012
Nanjing Bank	$	14,079,204	$	16,743,277
Shanghai Pudong Development Bank		6,464,000		7,014,833
Bank of Communications		9,703,498		6,953,834
HSBC		2,424,000		5,414,316
Everbright Bank		3,232,000		3,166,000
China Minsheng Bank	1,062,152			4,239,800
Bank of China	5,670,220			3,387,620
Ping An Bank	572,228			-
Hua xia Bank		1,616,000		-
	$	44,823,302	$	46,919,680

On August 2, 2010, Goldenway entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $8.08 million (RMB50 million). The line of credit is guaranteed by Jiangsu Ever-Glory International Group Corp. (“Jiangsu Ever-Glory”), an entity controlled by Mr. Kang, the Company’s Chairman and Chief Executive Officer. The line of credit is also collateralized by the Company’s property and equipment. As of June 30, 2013, Goldenway had borrowed $8.08 million (RMB50 million) under this line of credit from Nanjing Bank with an annual interest rate of 5.88% and due on various dates from July 2013 to October 2013. Approximately $1.61 million (RMB10 million) was repaid subsequent to June 30, 2013..

On May 11, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.70 million (RMB60 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory. As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB 20 million) under this line of credit with an annual interest rate ranging from 5.88% to 6.3% and due on July 2013. Ever-Glory Apparel had also borrowed $1.15 million from Nanjing Bank with an annual interest rate of 2.28%, due in July 2013, and collateralized by approximately $1.7 million of accounts receivable from wholesale customers.  At June 30, 2013, approximately $5.32 million was unused and available under this line of credit. Approximately $4.38 million was repaid subsequent to June 30, 2013.

On April 10, 2012, LA GO GO entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $3.23 million (RMB20 million). The line of credit is guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of June 30, 2013, LA GO GO had borrowed $1.62 million (RMB10 million) under this line of credit with annual interest rates ranging from 6.29% to 6.44% and due on various dates from September 2013 to October 2013. At June 30, 2013, approximately $1.61 million (RMB10 million) was unused and available under this line of credit.

On January 4, 2011, Goldenway entered into a revolving line of credit agreement for approximately $6.46 million (RMB40 million) with Shanghai Pudong Development Bank. As of June 30, 2013, Goldenway had borrowed the maximum amount available under the line of $6.46 million (RMB40 million), with an annual interest rate of 6.3%. These loans are collateralized by certain properties and land use rights of Goldenway, and are due in November 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $6.62 million (RMB 41 million) from the Bank of Communications with an annual interest rate ranging from 5.6% to 6.3% and due on various dates from October 2013 to February 2014. The loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang.  This loan is also collateralized by assets of Jiangsu Ever-Glory’s equity investee, Nanjing Knitting, under a collateral agreement executed among the Company, Jiangsu Ever-Glory, Nanjing Knitting and the bank. Ever-Glory Apparel had also borrowed $2.27 million from the Bank of Communications with an annual interest rate of 3.4%, due on various dates from July to September 2013, and collateralized by approximately $5.2 million of accounts receivable from wholesale customers.

As of June 30, 2013, LA GO GO had borrowed $0.81 million (RMB5 million) from the Bank of Communications with annual interest rate of 6.06% and due in July 2013. This loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang. Approximately $0.81 million (RMB5 million) was repaid subsequent to June 30, 2013.

On July 29, 2011, Ever-Glory Apparel and Perfect Dream collectively entered into a secured banking facility agreement for a combined revolving import facility, letter of credit, invoice financing facilities and a credit line for treasury products of up to $7.0 million with the Nanjing Branch of HSBC (China) Company Limited (“HSBC”). This agreement is guaranteed by the Company and Mr. Kang. As of June 30, 2013, Ever-Glory Apparel had borrowed $2.42 million from HSBC with annual interest rate of 5.6%, due on various dates from July to August 2013, and collateralized by approximately $4.5 million of accounts receivable from wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of June 30, 2013, approximately $4.58 million was unused and available. Approximately $1.62 million was repaid subsequent to June 30, 2013.

9

On August 21, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $13.41 million (RMB83 million) with Everbright Bank guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB20 million) from Everbright Bank, with annual interest rate of 6.3% and due in September 2013. At June 30, 2013, approximately $10.18 million (RMB63 million) was unused and available under this line of credit.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.06 million from China Minsheng Bank, with annual interest rate of 2.93% and due in September 2013 and collateralized by approximately $1.6 million of accounts receivable from wholesale customers.

On November 16, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $4.20 million (RMB26 million) with Bank of China guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) under this line of credit with annual interest rate of 6.05% and due on December 2013. Ever-Glory Apparel had also borrowed $4.05 million (including $1.79 million and RMB14 million) from Bank of China with an annual interest rate ranging from 1.8% to 6.72%, due on various dates from July to September 2013, and collateralized by approximately $7.2 million of accounts receivable from wholesale customers. Approximately $0.4 million was repaid subsequent to June 30, 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $0.57 million from Ping An Bank, with annual interest rate of 6.3%, due in September 2013, and collateralized by approximately $0.72 million of accounts receivable from wholesale customers.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) from Hua Xia Bank, with annual interest rate of 6.6% and due in April 2014. This loan is guaranteed by Goldenway.

Total interest expense on bank loans amounted to $736,695, $1,528,224, $458,703 and $1,004,744 for the three and six months ended June 30, 2013 and 2012, respectively.

NOTE 6   DERIVATIVE WARRANT LIABILITY

The Company had warrants outstanding to purchase an aggregate of 840,454 shares of Company common stock, which warrants required liability classification because of certain provisions that may have resulted in an adjustment to their exercise price. The warrants expired in June 2013. At the expiration date, the remaining value of the warrants not exercised ($2,000) was reduced to $0. The increase in other income resulting from the decrease in derivative warrant liability was $2,000 and $294,000 for the three and six months ended June 30, 2013, respectively, and $180,000 and $290,800 for the three and six months ended June 30, 2012, respectively.

NOTE 7   INCOME TAX

PRC pre-tax income for the three and six months ended June 30, 2013 and 2012, was taxable in the following jurisdictions.

	Three months ended					Six months ended
	June 30,					June 30,
	2013			2012		2013			2012
PRC	$	2,863,460		$	1,582,335	$	5,548,096		$	3,350,278
Samoa		636,295			882,620		1,462,766			1,713,142
BVI		(1,003	)		26,204		(2,318	)		(38,159	)
Others		(3,000	)		181,000		283,918			292,964
	$	3,495,752		$	2,672,159	$	7,292,462		$	5,318,225

The Company’s operating subsidiaries are governed by the Income Tax Law of the PRC concerning Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws (“the Income Tax Laws”). 

All PRC subsidiaries are subject to income tax at 25% statutory rate.

10

Perfect Dream was incorporated in the British Virgin Islands (BVI), and under the current laws of the BVI dividends and capital gains arising from the Company’s investments in the BVI are not subject to income taxes.

Ever-Glory HK was incorporated in Samoa and has no liabilities for income tax under the current laws of Samoa.

The following table reconciles the PRC statutory rates to the Company’s effective tax rate for the three and six months ended June 30, 2013 and 2012, respectively:

	Three months ended						Six months ended
	June 30,						June 30,
	2013			2012			2013			2012
PRC statutory rate		25.0	%		25.0	%		25.0	%		25.0	%
Non-taxable or non-deductible items		-			(2.3	)		(1.4	)		(1.9	)
Effect of foreign income tax rates		(4.5	)		(8.5	)		(5.0	)		(7.9	)
Other		1.5			(2.2	)		1.7			0.7
Effective income tax rate		22.0	%		12.0	%		20.3	%		15.9	%

Income tax expense for the three and six months ended June 30, 2013 and 2012 is as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Current	$	626,528	$	121,988	$	855,572	$	265,092
Deferred		142,013		199,022		622,600		580,774
Income tax expense	$	768,541	$	321,010	$	1,478,172	$	845,866

NOTE 8    EARNINGS PER SHARE

The following demonstrates the calculation for earnings per share for the three and six months ended June 30, 2013 and 2012:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Net income	$	2,727,211	$	2,351,149	$	5,814,290	$	4,472,359
Weighted average number of common shares –Basic and diluted		14,777,610		14,765,942		14,775,869		14,763,815
Earnings per share –Basic and diluted	$	0.18	$	0.16	$	0.39	$	0.30

For three and six months ended June 30, 2012, the Company excluding 840,454 warrants outstanding from diluted earnings per share as they were anticipative.

NOTE 9    STOCKHOLDERS’ EQUITY

On February 28, 2013, the Company issued an aggregate of 5,340 shares of its common stock to three of the Company’s independent directors as compensation for their services in the third and fourth quarters of 2012. The shares were valued at $1.89 per share, which was the average market price of the common stock for the five days before the grant date.

11

NOTE 10   RELATED PARTY TRANSACTIONS

Mr. Kang is the Company’s Chairman and Chief Executive Officer.  Ever-Glory Enterprises (H.K.) Ltd. (“Ever-Glory Enterprises”) is the Company’s major shareholder.  Mr. Xiaodong Yan is Ever-Glory Enterprises’ sole shareholder. All transactions associated with the following companies controlled by Mr. Kang or Mr. Yan are considered to be related party transactions, and it is possible that the terms of these transactions may not be the same as those that would result from transactions between unrelated parties. All related party outstanding balances are short-tem in nature and are expected to be settled in cash.

Other income from Related Parties

Included in other income for the three and six months ended June 30, 2013 and 2012 is rent revenue from entities controlled by Mr. Kang under operating lease agreements with various terms though 2015 as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
EsCeLav	$	3,056	$	2,969	$	6,038	$	5,933
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		4,070		3,952		8,050		7,905
Total	$	7,126	$	6,921	$	14,088	$	13,838

Other expenses due to Related Parties

Included in other expenses for the three and six months ended June 30, 2013 and 2012 are rent costs due to entities controlled by Mr. Kang under operating lease agreements as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Jiangsu Ever-Glory	$	12,788	$	12,403	$	25,277	$	24,822
Kunshan Enjin		8,517		6,569		16,774		13,137
Total	$	21,305	$	18,972	$	42,051	$	37,959

Purchases from, and Sub-contracts with Related Parties

For the three and six months ended June 30, 2013 and 2012, the Company purchased raw materials of $101,370, $184,608, $79,413, $714,022, respectively, from Nanjing Knitting.

In addition, the Company sub-contracted certain manufacturing work to related parties totaling $5,102,919, $9,088,426, $2,597,793, $5,423,363 for the three and six months ended June 30, 2013 and 2012, respectively. The Company provided raw materials to the sub-contractors and was charged a fixed fee for labor provided by the sub-contractors.

Sub-contracts with related parties included in cost of sales for the three and six months ended June 30, 2013 and 2012 are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Nanjing Knitting	$	211,296	$	119,159	$	232,602	$	753,768
Nanjing Ever-Kyowa		255,893		246,417		523,878		411,634
Ever-Glory Vietnam		3,175,681		625,667		5,094,787		1,455,136
Ever-Glory Cambodia		1,446,661		1,594,778		3,221,188		2,781,291
EsCeLav		1,775		6,616		4,358		12,564
Jiangsu Ever-Glory		11,613		5,156		11,613		8,970
	$	5,102,919	$	2,597,793	$	9,088,426	$	5,423,363

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Accounts Payable – Related Parties

The Company purchases raw materials from and subcontracts some of its production to related parties. Accounts payable to related parties at June 30, 2013 and December 31, 2012 are as follows:

	June 30, 2013		December 31, 2012
Nanjing Knitting	$	747,004	$	756,842
Nanjing Ever-Kyowa		78,272		128,505
Ever-Glory Vietnam		1,117,607		2,183,039
Ever-Glory Cambodia		1,414,613		90,428
Kunshan Enjin		16,774		-
Total	$	3,374,270	$	3,158,814

Amounts Due From Related Party

The amounts due from related parties at June 30, 2013 and December 31, 2012 are as follows:

	June 30, 2013		December 31, 2012
EsCeLav	$	12,473	$	8,680
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		61,702		-
Jiangsu Ever-Glory		25,450,229		33,573,977
Total	$	25,524,404	$	33,582,657

Jiangsu Ever-Glory is an entity engaged in importing/exporting, apparel-manufacture, real-estate development, car sales and other activities. Jiangsu Ever-Glory is controlled by Mr. Kang. Because of restrictions on its ability to directly import and export products, the Company had utilized Jiangsu Ever-Glory as its agent to assist the Company with its import and export transactions and its international transportation projects since 2005. Import transactions primarily consist of purchases of raw materials and accessories designated by the Company’s customers for use in garment manufacture. Export transactions consist of the Company’s sales to foreign markets such as Japan, Europe and the United States. These transactions ceased at end of 2011.

In March 2012, in consideration of the guarantees and collateral provided by Jiangsu Ever-Glory and Nanjing Knitting, the Company agreed to provide Jiangsu Ever-Glory a counter guarantee in the form of cash of not less than 70% of the maximum aggregate lines of credit obtained by the Company. Jiangsu Ever-Glory is obligated to return the full amount of the counter-guarantee funds provided upon expiration or termination of the underlying lines of credit and is to pay annual interest at the rate of 6.0% of amounts provided. As of June 30, 2013, Jiangsu Ever-Glory has provided guarantees for approximately $45.4 million (RMB 281 million) of lines of credit obtained by the Company. Jiangsu Ever-Glory, and its 20.31% owned equity investee, Nanjing Knitting, have also provided their assets as collateral for certain of these lines of credit. The value of the collateral, as per appraisals obtained by the banks in connection with these lines of credit is approximately $21.33 million (RMB 132 million).  Mr. Kang has also provided a personal guarantee for $22.46 million (RMB 139 million). During the six months ended June 30, 2013, $7.27 million (RMB45 million) was provided to Jiangsu Ever-Glory under the counter-guarantee. As of June 30, 2013, the amount of the counter-guarantee had been reduced to $21.24 million (RMB131 million), which was 46.7% of the aggregate amount of lines of credit. This amount plus accrued interest of $1.88 million have been classified as a reduction of equity, consistent with the guidance of SEC Staff Accounting Bulletins 4E and 4G.

13

Interest of 0.5% is charged on net amounts due from Jiangsu Ever-Glory at each month end. Interest income for the three and six months ended June 30, 2013 and 2012 was approximately $0.34 million, $0.64 million, $0.33 million and $0.61 million, respectively.

 Following is a summary of balances at June 30, 2013 and December 31, 2012:

Related Party	Type of transaction	June 30, 2013		December 31, 2012
Jiangsu Ever-glory	Accounts receivable	$	1,059,477	$	214,226
Jiangsu Ever-glory	Advance/(Accounts payable)		1,271,387		(53,680	)
Jiangsu Ever-glory	Interest income		1,878,066		1,262,701
Jiangsu Ever-glory	Counter guarantee deposit		21,241,299		32,150,730
Total		$	25,450,229	$	33,573,977

NOTE 11   CONCENTRATIONS AND RISKS

The Company extends unsecured credit to its customers in the normal course of business and generally does not require collateral. As a result, management performs ongoing credit evaluations, and the Company maintains an allowance for potential credit losses based upon its loss history and its aging analysis. Based on management’s assessment of the amount of probable credit losses, if any, in existing accounts receivable, management has concluded that no allowance for doubtful accounts is necessary at June 30, 2013 and December 31, 2012. Management reviews the allowance for doubtful accounts each reporting period based on a detailed analysis of accounts receivable. In the analysis, management primarily considers the age of the customer’s receivable and also considers the credit worthiness of the customer, the economic conditions in the customer’s industry, and general economic conditions and trends, among other factors. If any of these factors change, the Company may also change its original estimates, which could impact the level of the Company’s future allowance for doubtful accounts.  If judgments regarding the collectability of accounts receivables are incorrect, adjustments to the allowance may be required, which would reduce profitability. 

For the six-month period ended June 30, 2013, the Company had two wholesale customers that each represented approximately 11% of the Company’s revenues. For the three-month period ended June 30, 2013, the Company had two wholesale customers that represented approximately 14% and 10% of the Company’s revenues respectively, For the six-month period ended June 30, 2012, the Company had two wholesale customers that represented approximately 13% and 12% of the Company’s revenues, respectively. For the three-month period ended June 30, 2012, the Company had two wholesale customers that each represented approximately 11% of the Company’s revenues.

For the Company’s wholesale business during the three and six months ended June 30, 2013 and 2012, no supplier represented more than 10% of the total raw materials purchased.

For the Company’s retail business, the Company had no supplier that represented more than 10% of raw materials purchases during the six months ended June 30, 2013. The Company purchased 10% of  its raw materials from one supplier during the three months ended June 30, 2013. For the Company’s retail business, the Company had one supplier that represented approximately 14% of raw materials purchases during the six months ended June 30, 2012. The Company purchased 11% and 14% of its raw materials from two suppliers respectively, during the three months ended June 30, 2012.

For the wholesale business, during the six months ended June 30, 2013, the Company relied on two manufacturers for 15% and 13% of purchased finished goods, respectively. During the six months ended June 30, 2012, the Company relied on two manufacturers for 17% and 13% of purchased finished goods, respectively. During the three months ended June 30, 2013, the Company relied on two manufacturers for 17% and 16% of purchased finished goods, respectively. During the three months ended June 30, 2012, the Company relied on two manufacturers for 19% and 16% of purchased finished goods, respectively. 

For the retail business, during the three and six months ended June 30, 2013 and 2012, no supplier represented more than 10% of the total purchased finished goods.

14

The Company’s revenues for the three and six months ended June 30, 2013 and 2012 were earned in the following geographic areas:

	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
The People’s Republic of China	$	40,694,314	$	29,320,073	$	100,376,413	$	59,828,555
Germany		3,305,231		3,393,413		7,676,564		8,858,106
United Kingdom		4,961,895		4,588,231		7,826,529		7,953,390
Europe-Other		3,134,666		3,189,555		7,102,281		7,753,988
Japan		5,306,554		2,416,434		9,005,388		8,523,582
United States		1,726,825		4,287,325		5,453,800		7,503,583
Total	$	59,129,485	$	47,195,031	$	137,440,975	$	100,421,204

NOTE 12   SEGMENTS

The Company reports financial and operating information in the following two segments:

(a)  Wholesale segment

(b)  Retail segment

	Wholesale segment		Retail segment		Total
Six months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	58,711,923	$	78,729,052	$	137,440,975
Income from operations	$	5,339,873	$	2,696,664	$	8,036,537
Interest income	$	624,195	$	13,595	$	637,790
Interest expense	$	1,412,096	$	116,128	$	1,528,224
Depreciation and amortization	$	478,315	$	3,212,576	$	3,690,891
Income tax expense	$	828,834	$	649,338	$	1,478,172
Six months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	59,468,451	$	40,952,753	$	100,421,204
Income (loss) from operations	$	4,494,836	$	690,800	$	5,185,636
Interest income	$	603,785	$	6,435	$	610,220
Interest expense	$	938,754	$	65,990	$	1,004,744
Depreciation and amortization	$	498,899	$	1,798,011	$	2,296,910
Income tax expense	$	687,462	$	158,404	$	845,866

	Wholesale segment		Retail segment		Total
Three months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	27,051,468	$	32,078,017	$	59,129,485
Income from operations	$	2,547,245	$	1,520,112	$	4,067,357
Interest income	$	332,268	$	9,920	$	342,188
Interest expense	$	678,069	$	58,626	$	736,695
Depreciation and amortization	$	244,604	$	1,815,642	$	2,060,246
Income tax expense	$	400,680	$	367,861	$	768,541
Three months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	28,807,928	$	18,387,103	$	47,195,031
Income (loss) from operations	$	1,967,832	$	454,284	$	2,422,116
Interest income	$	325,486	$	3,250	$	328,736
Interest expense	$	424,193	$	34,510	$	458,703
Depreciation and amortization	$	248,435	$	887,840	$	1,136,275
Income tax expense	$	215,057	$	105,953	$	321,010

15

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JUNE 30, 2013 AND 2012

(UNAUDITED)

ITEM 2.      MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations for the three and six months  ended June 30, 2013 should be read in conjunction with the Financial Statements and corresponding notes included in this Quarterly Report on Form 10-Q. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations, and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the Risk Factors and Special Note Regarding Forward-Looking Statements in this report. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” “target”, “forecast” and similar expressions to identify forward-looking statements.

Overview

Our Business

We are a leading apparel supply-chain manager and retailer in China. We are listed on NYSE MKT (previously NYSE Amex) under the symbol of “EVK”.

We classify our businesses into two segments: Wholesale and Retail. Our wholesale business consists of wholesale-channel sales made principally to famous brands, and department stores located throughout Europe, the U.S., Japan and the People’s Republic of China (“PRC”). We focus on well-known, middle-to-high grade casual wear, sportswear, and outerwear brands. Our retail business consists of retail-channel sales directly to consumers through retail stores located throughout the PRC.

Although we have our own manufacturing facilities, we currently outsource most of the manufacturing to our long-term contractors as part of our overall business strategy. We believe outsourcing allows us to maximize our production capacity and maintain flexibility while reducing capital expenditures and the costs of keeping skilled workers on production lines during low seasons. We oversee our long-term contractors with our advanced management solutions and inspect products manufactured by them to ensure that they meet our high quality control standards and timely delivery. 

Wholesale Business

We conduct our original design manufacturing (“ODM”) operations through six wholly-owned subsidiaries which are located in the Nanjing Jiangning Economic and Technological Development Zone and Shang Fang Town in the Jiangning District in Nanjing, China: Ever-Glory International Group Apparel Inc. (“Ever-Glory Apparel”), Goldenway Nanjing Garments Company Limited (“Goldenway”), Nanjing New-Tailun Garments Company Limited (“New Tailun”), Nanjing Catch-Luck Garments Co., Ltd. (“Catch-Luck”), Ever-Glory International Group (HK) Ltd. (“Ever-Glory HK”), and Nanjing Tai Xin Garments Trading Company Limited (“Tai Xin”).

Retail Business

We conduct our retail operations through Shanghai LA GO GO Fashion Company Limited (“LA GO GO”), a wholly-owned subsidiary of Ever-Glory Apparel.

Business Objectives

Wholesale Business

We believe the enduring strength of our wholesale business is mainly due to our consistent emphasis on innovative and distinctive product designs that stand for exceptional styling and quality.

16

The primary business objective for our wholesale segment is to expand our portfolio into higher-class brands, expand our customer base and improve our profit. We believe that our growth opportunities and continued investment initiatives include:

● Expand our global sourcing network

● Expand our overseas low-cost manufacturing base (outside of mainland China);

● Focus on high value-added products and continue our strategy to produce mid to high end apparel

● Continue to emphasize product design and technology utilization.

● Seek strategic acquisitions of international distributors that could enhance global sales and our distribution network; and

● Maintain stable revenue increases in the markets while shifting focus to higher margin wholesale markets such as mainland China.

Retail Business

The business objective for our retail segment is to establish a leading brand of women’s apparel and to build a nationwide retail network in China. As of June 30, 2013, we have 831 stores (including store-in-stores) which included 127 stores that were opened and 23 stores that were closed in first half of 2013.

We believe that our growth opportunities and continued investment initiatives include:

● Build the LA GO GO brand to be recognized as a major player in the mid-end women's apparel market in China;

● Expand the LA GO GO retail network throughout China;

● Improve the LA GO GO retail stores’ efficiency and increase same-store sales

● Continue to launch LA GO GO flagship stores in Tier-1 Cities and increase penetration and coverage in Tier-2 and Tier-3 Cities

● Become a multi-brand operator by seeking opportunities for long-term cooperation with reputable international brands and by facilitating international brands entry into the Chinese market.

Seasonality of Business

Our business is affected by seasonal trends, with higher levels of wholesale sales in our third and fourth quarters and higher retail sales in our first and fourth quarters. These trends primarily result from the timing of seasonal wholesale shipments and holiday periods in the retail segment.

Collection Policy

Wholesale business

For our new customers, we generally require orders placed to be backed by letters of credit. For our long-term and established customers with a good payment track record, we generally provide payment terms between 30 to 180 days following delivery of finished goods.

Retail business

For store-in-store shops, we generally receive payments from the stores between 60 and 90 days following the date of the register receipt. For our own flagship stores, we receive payments at the time of the register receipt.

17

Global Economic Uncertainty

Our business is dependent on consumer demand for our products. We believe that the significant uncertainty in the global economy and a slowdown in the United States and European economies have increased our clients’ sensitivity to the cost of our products. We have experienced continued pricing pressure. If the global economic environment continues to be weak or should it weaken, these economic conditions could have a negative impact on our sales growth and operating margins in our wholesale segment in 2013.

In addition, economic conditions in the United States and other foreign markets in which we operate could substantially affect our sales, and profitability, and our cash position and collection of accounts receivable. Global credit and capital markets have experienced unprecedented volatility and disruption. Business credit and liquidity have tightened in much of the world. Some of our suppliers and customers may face credit issues and could experience cash flow problems and other financial hardships. These factors currently have not had an impact on the timeliness of receivable collections from our customers. We cannot predict at this time how this situation will develop and whether reserve for bad accounts receivable may need to be taken or such receivable written off in the coming quarters.

Despite the various risks and uncertainties associated with the current global economy, we believe our core strengths will continue to allow us to execute our strategy for long-term sustainable growth in revenue, net income and operating cash flow.

Summary of Critical Accounting Policies

We have identified critical accounting policies that, as a result of judgments, uncertainties, uniqueness and complexities of the underlying accounting standards and operation involved could result in material changes to our financial position or results of operations under different conditions or using different assumptions.

Revenue Recognition

We recognize wholesale revenue from product sales, net of value-added taxes, upon delivery for local sales and upon shipment of the products for export sales, at such time title passes to the customer provided however that (i) there are no uncertainties regarding customer acceptance (ii) persuasive evidence of an arrangement exists (iii) the sales price is fixed and determinable, and (iv) collectability is deemed probable. We recognize wholesale revenue from manufacturing fees charged to buyers for the assembly of garments from materials provided by the buyers upon completion of the manufacturing process and shipment of the products for export sales, provided that (i) there are no uncertainties regarding customer acceptance (ii) persuasive evidence of an arrangement exists (iii) the sales price is fixed and determinable, and (iv) collectability is deemed probable. Retail sales are recorded at the time of register receipt.

Estimates and Assumptions

In preparing our consolidated financial statements, we use estimates and assumptions that affect the reported amounts and disclosures. Our estimates are often based on complex judgments, probabilities and assumptions that we believe to be reasonable, but that are inherently uncertain and unpredictable. We are also subject to other risks and uncertainties that may cause actual results to differ from estimated amounts. Significant estimates in 2013 and 2012 include the assumptions used to value warrants and the estimates of the allowance for deferred tax assets.

Results of Operations for the three months ended June 30, 2013 and 2012

The following table summarizes our results of operations for the three months ended June 30, 2013 and 2012. The table and the discussion below should be read in conjunction with our condensed consolidated financial statements and the notes thereto appearing elsewhere in this report.

		Three Months Ended June 30,
		2013				2012
		(in U.S. Dollars, except for percentages)
Sales	$	59,129,485	100.0	%	$	47,195,031	100.0	%
Gross Profit	$	19,478,568	32.9	%	$	13,586,581	28.8	%
Operating Expense	$	15,411,211	26.0	%	$	11,164,465	23.7	%
Income From Operations	$	4,067,357	6.9	%	$	2,422,116	5.1	%
Other Income (Expenses)	$	(571,605)	(0.1)	%	$	250,043	0.1	%
Income tax expense	$	768,541	1.3	%	$	321,010	0.7	%
Net Income	$	2,727,211	4.6	%	$	2,351,149	5.0	%

18

Revenue

The following table sets forth a breakdown of our total sales, by region, for the three months ended June 30, 2013 and 2012.

	2013		% of total sales			2012		% of total sales			Growth in 2013compared with 2012
Wholesales business
The People’s Republic of China	$	8,616,297		14.6	%	$	10,932,971		23.2	%		(21.2	)%
Germany		3,305,231		5.6			3,393,413		7.2			(2.6	)
United Kingdom		4,961,895		8.4			4,588,231		9.7			8.1
France		2,956,328		5.0			3,049,795		6.5			(3.1	)
Europe-Other		178,338		0.3			139,760		0.3			27.6
Japan		5,306,554		9.0			2,416,433		5.1			119.6
United States		1,726,825		2.9			4,287,325		9.1			(59.7	)
Total wholesale business		27,051,468		45.7			28,807,928		61.0			(6.1)
Retail business		32,078,017		54.3			18,387,103		39.0			74.5
Total	$	59,129,485		100.0	%	$	47,195,031		100.0	%		25.3	%

Sales for the three months ended June 30, 2013 were $59.1 million, an increase of 25.3% from the three months ended June 30, 2012. This increase was primarily attributable to increased sales in our retail business partially offset for decreased sales in our wholesales business.

Sales generated from our wholesale business contributed 45.7% or $27.1 million of our total sales for the three months ended June 30, 2013, a decrease of 6.1% compared to $28.8 million in the three months ended June 30, 2012. This decrease was primarily attributable to decreased sales in P.R.C, the United States, Germany and France. The reduced sales in the overseas wholesale segment was primarily due to global economic uncertainty and instability, the advanced economies represented by Europe and the US are recovering slowly, which seriously impacted China's apparel exports; therefore, our overseas wholesale business also faced declining orders. The  domestic fashion consumption was weak due to the slow microeconomic development in China. As the retailers kept to reduce inventory, our domestic wholesale decreased 21.2% compared to the same period last year.

Sales generated from our retail business contributed 54.3% or $32.1 million of our total sales for the three months ended June 30, 2013, an increase of 74.5% compared to 39.0% or $18.4 million in the three months ended June 30, 2012. This increase was primarily due to the increase in same store sales and new stores opened. We had 831 LA GO GO stores as of June 30, 2013, compared to 562 LA GO GO stores at June 30, 2012.

Costs and Expenses

Cost of Sales and Gross Margin

Cost of goods sold includes the direct raw material cost, direct labor cost, and manufacturing overhead including depreciation of production equipment and rent, consistent with the revenue earned. Cost of goods sold excludes warehousing costs, which historically have not been significant.

19

The following table sets forth the components of our cost of sales and gross profit both in amounts and as a percentage of total sales for the three months ended June 30, 2013 and 2012.

									Growth
									(Decrease) in
	Three months ended June 30,								2013 Compared
	2013				2012				with 2012
	(in U.S. dollars, except for percentages)
Net Sales for Wholesale Sales	$	27,051,468	100.0	%	$	28,807,928	100.0	%		(6.1	)%
Raw Materials		12,038,807	44.5			13,097,205	45.5			(8.1	)
Labor		1,231,609	4.6			1,137,557	3.9			8.3
Outsourced Production Costs		6,942,002	25.7			7,979,797	27.7			(13.0	)
Other and Overhead		140,929	0.5			22,662	0.1			521.8
Total Cost of Sales for Wholesale		20,353,347	75.2			22,237,221	77.2			(8.5	)
Gross Profit for Wholesale		6,698,121	24.8			6,570,707	22.8			1.9
Net Sales for Retail		32,078,017	100.0			18,387,103	100.0			74.5
Production Costs		9,455,948	29.5			5,212,762	28.4			81.4
Rent		9,841,622	30.7			6,158,467	33.5			59.8
Total Cost of Sales for Retail		19,297,570	60.2			11,371,229	61.8			69.7
Gross Profit for Retail		12,780,447	39.8			7,015,874	38.2			82.2
Total Cost of Sales		39,650,917	67.1			33,608,450	71.2			18.0
Gross Profit	$	19,478,568	32.9	%	$	13,586,581	28.8	%		43.4	%

Raw material costs for our wholesale business were 44.5% of our total wholesale business sales in the three months ended June 30, 2013, compared to 45.5% in the three months ended June 30, 2012.  The decrease was mainly due to decreased raw materials prices.

Labor costs for our wholesale business were 4.6% of our total wholesale business sales in the three months ended June 30, 2013, compared to 3.9% in the three months ended June 30, 2012. The increase was mainly due to the increased average salaries of employees.

Outsourced manufacturing costs for our wholesale business were 25.7% of our total wholesale business sales in the three months ended June 30, 2013, compared to 27.7% in the three months ended June 30, 2012. This decrease was primarily attributable to the outsourced orders of approximately $4.6 million to our related factories in Vietnam and Cambodia, for lower manufacturing costs in the three months ended June 30, 2013.

Overhead and other expenses for our wholesale business accounted for 0.5% of our total wholesale business sales for the three months ended June 30, 2013, compared to 0.1% of total sales for the three months ended June 30, 2012.

Wholesale business gross profit for the three months ended June 30, 2013 and 2012 was $6.7 and $6.6 million, respectively. As a percentage of wholesale sales, gross profit accounted for 24.8% of our total wholesale sales for the three months ended June 30, 2013, an increase of 2.0% compared to 22.8% for the three months ended June 30, 2012. The increase was mainly due to decreased raw materials prices and outsourced manufacturing costs.

Production costs for our retail business were $9.5 million during the three months ended June 30, 2013 compared to $5.2 million during the three months ended June 30, 2012. As a percentage of retail sales, retail production costs accounted for 29.5% of our total retail sales in the three months ended June 30, 2013, compared to 28.4% of total retail sales in the three months ended June 30, 2012. This increase was primarily due to reduced retail prices in various promotions in exchange for increased sales volume during the three months ended June 30, 2013.      .

Rent costs for our retail business were $9.8 million for the three months ended June 30, 2013 compared to $6.2 million for the three months ended June 30, 2012. As a percentage of sales, rent costs accounted for 30.7% of our total retail sales for the three months ended June 30, 2013, compared to 33.5% of total retail sales for the three months ended June 30, 2012. Total rent costs increased as a result of the increase in the number of our stores. The decrease in rent costs as a percentage of total retail sales was due to an increase in same store sales in 2013.

Gross profit in our retail business for the three months ended June 30, 2013 was $12.8 million and gross margin was 39.8%. Gross profit in our retail business for the three months ended June 30, 2012 was $7.0 million and gross margin was 38.2%.

Total cost of sales for the three months ended June 30, 2013 was $39.7 million, compared to $33.6 million for the three months ended June 30, 2012, an increase of 18.0%. As a percentage of total sales, cost of sales decreased to 67.1% of total sales for the three months ended June 30, 2013, compared to 71.2% of total sales for the three months ended June 30, 2012. Consequently, gross margin increased to 32.9% for the three months ended June 30, 2013 from 28.8% for the three months ended June 30, 2012.

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Selling, General and Administrative Expenses

Our selling expenses consist primarily of local transportation, unloading charges, product inspection charges, salaries for retail staff and decoration and marketing expenses associated with our retail business.

Our general and administrative expenses include administrative salaries, office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing costs and other expenses that are not directly attributable to our revenues.

Costs of our distribution network that are excluded from cost of sales consist of local transportation and unloading charges, and product inspection charges. Accordingly our gross profit amounts may not be comparable to those of other companies who include these amounts in cost of sales.

	Three Months Ended June 30,										Increase/
	2013					2012					(Decrease)
	(in U.S. Dollars, except for percentages)
Gross Profit	$	19,478,568		32.9	%	$	13,586,581		28.8	%		43.4	%
Operating Expenses:
Selling Expenses		9,898,106		16.7			6,966,335		14.8			42.1
General and Administrative Expenses		5,513,105		9.3			4,198,130		8.9			31.3
Total		15,411,211		26.0			11,164,465		23.7			38.0
Income from Operations	$	4,067,357		6.9	%	$	2,422,116		5.1	%		67.9	%

Selling expenses increased 42.1% to $9.9 million for the three months ended June 30, 2013 from $7.0 million for the three months ended June 30, 2012. The increase was attributable to the increased number of retail employees and increased average salaries, as well as increased store decoration and marketing expenses associated with the promotion of the LA GO GO brand.

General and administrative expenses increased 31.3% to $5.5 million for the three months ended June 30, 2013 from $4.2 million for the three months ended June 30, 2012. As a percentage of total sales, general and administrative expenses increased to 9.3% of total sales for the three months ended June 30, 2013, compared to 8.9% of total sales for the three months ended June 30, 2012. The increase was attributable to an increase in payroll for additional management and design and marketing staff as a result of our business expansion.

Income from Operations

Income from operations increased 67.9% to $4.1 million for the three months ended June 30, 2013 from $2.4 million for the three months ended June 30, 2012.  As a percentage of sales, income from operations accounted for 6.9% of our total sales for the three months ended June 30, 2013, an increase of 1.8% compared to the three months ended June 30, 2012 as a result of increasing gross profit.

Interest Expense

Interest expense was $0.7 million for the three months ended June 30, 2013, an increase of 60.6% compared to the same period in 2012. This increase was attributable to the increased interest rates and loan amounts.

Change in fair value of derivative liability

Change in fair value of derivative liability was a gain of $0.002 million and $0.2 million, based on the Binnomial Lattice model, for the three months ended June 30, 2013 and 2012, respectively.

Income Tax Expenses

Income tax expense for the three months ended June 30, 2013 was $0.8 million, an increase of 139% compared to the same period of 2012. The increase was primarily due to increased profits of LA GO GO.

Our PRC subsidiaries are governed by the Income Tax Law of the PRC concerning Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws. Each of our consolidated entities files its own separate income tax return.

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All PRC subsidiaries are subject to 25% income tax rate.

Perfect Dream Limited was incorporated in the British Virgin Islands on July 1, 2004, and has no income tax.

Ever-Glory International Group (HK) Ltd was incorporated in Samoa on September 15, 2009, and has no liabilities for income tax.

Ever-Glory International Group Inc. was incorporated in the United States and has incurred net operating losses for income tax purposes through 2011. The net operating loss carry forwards for United States income taxes may be available to reduce future years’ taxable income. These carry forwards will expire, if not utilized, through 2031. Management believes that the realization of the benefits from these losses is uncertain due to our limited operating history and continuing losses for United States income tax purposes. Accordingly, we provided a 100% valuation allowance on the deferred tax asset to reduce the asset to zero.

Net Income

Net income for the three months ended June 30, 2013 was $2.7 million, an increase of 16% compared to the same period in 2012. Our basic and diluted earnings per share were $0.18 and $0.16 for the three months ended June 30, 2013 and 2012, respectively.

Results of Operations for the six months ended June 30, 2013 and 2012

The following table summarizes our results of operations for the six months ended June 30, 2013 and 2012. The table and the discussion below should be read in conjunction with the consolidated financial statements and the notes thereto appearing elsewhere in this report.

		Six Months Ended June 30,
		2013					2012
		(in U.S. Dollars, except for percentages)
Sales	$	137,440,975		100.0	%	$	100,421,204		100.0	%
Gross Profit		39,771,491		28.9			25,189,569		25.1
Operating Expense		31,734,954		23.1			20,003,933		19.9
Income From Operations		8,036,537		5.8			5,185,636		5.2
Other Income (Expenses)		(744,075	)	0.5			(132,589	)	0.1
Income tax expense		1,478,172		1.1			845,866		0.8
Net Income	$	5,814,290		4.2	%	$	4,472,359		4.5	%

Revenue

The following table sets forth a breakdown of our total sales, by region, for the six months ended June 30, 2013 and 2012.

	2013		% of total sales			2012		% of total sales			Growth in 2013compared with 2012
Wholesales business
The People’s Republic of China	$	21,647,361		15.8	%	$	18,875,802		18.8	%		14.7	%
Germany		7,676,564		5.6			8,858,106		8.8			(13.3	)
United Kingdom		7,826,529		5.7			7,953,390		7.9			(1.6	)
France		6,369,316		4.6			7,139,555		7.1			(10.8	)
Europe-Other		732,965		0.5			614,433		0.6			19.3
Japan		9,005,388		6.6			8,523,582		8.5			5.7
United States		5,453,800		4.0			7,503,583		7.5			(27.3	)
Total wholesale business		58,711,923		42.7			59,468,451		59.2			(1.3	)
Retail business		78,729,052		57.3			40,952,753		40.8			92.2
Total	$	137,440,975		100.0	%	$	100,421,204		100.0	%		36.9	%

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Sales for the six months ended June 30, 2013 were $137.4 million, an increase of 36.9% from the six months ended June 30, 2012. This increase was primarily attributable to increased sales in our retail business.

Sales generated from our wholesale business contributed 42.7% or $58.7 million of our total sales for the six months ended June 30, 2013, a decrease of 1.3% compared to $59.5 million in the six months ended June 30, 2012. This decrease was primarily attributable to decreased sales in Germany, the United States and France. The reduced sales in the overseas wholesale segment was primarily due to global economic uncertainty and instability, the developed economies represented by Europe and the US are recovering slowly, which seriously impacted China's apparel exports; as a result, our overseas wholesale business also faced declining orders.

Sales generated from our retail business contributed 57.3% or $78.7 million of our total sales for the six months ended June 30, 2013, an increase of 92.2% compared to 40.8% or $41.0 million in the six months ended June 30, 2012. This increase was primarily due to the increase in same store sales and new stores opened. We had 831 LA GO GO stores as of June 30, 2013, compared to 562 LA GO GO stores at June 30, 2012.

Total retail store square footage and sales per square foot for the six months ended June 30, 2013 and 2012 are as follows:

	2013		2012
Total store square footage		754,870		489,444
Number of stores		831		562
Average store size, square feet		908		871
Total store sales	$	78,729,052	$	40,952,753
Sales per square foot	$	104	$	84

Same store sales and newly opened store sales for the six months ended June 30, 2013 and 2012 are as follows:

	2013		2012
Sales from stores open a full year	$	49,510,906	$	24,508,726
Newly opened store sales		26,054,394		14,133,718
Other*		3,163,752		2,310,309
Total	$	78,729,052	$	40,952,753

*Primarily sales from stores that were closed in the current reporting period.

We remodeled or relocated 119 stores in 2012, and we plan to relocate or remodel 200 stores in 2013. Remodels and relocations typically drive incremental same-store sales growth. A relocation typically results in an improved, more visible and accessible location, and usually includes increased square footage. We believe we will continue to have opportunities for additional remodels and relocations beyond 2013.  Same-store sales are calculated based upon stores that were open at least 12 full fiscal months in each reporting period and remain open at the end of each reporting period.

Costs and Expenses

Cost of Sales and Gross Margin

Cost of goods sold includes the direct raw material cost, direct labor cost, and manufacturing overhead including depreciation of production equipment and rent, consistent with the revenue earned. Cost of goods sold excludes warehousing costs, which historically have not been significant.

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The following table sets forth the components of our cost of sales and gross profit both in amounts and as a percentage of total sales for the six months ended June 30, 2013 and 2012.

									Growth
									(Decrease) in
	Six months ended June 30,								2013 compared
	2013				2012				with 2012
	(in U.S. dollars, except for percentages)
Net Sales for Wholesale Sales	$	58,711,923	100.0	%	$	59,468,451	100.0	%		(1.3	)%
Raw Materials		26,041,183	44.4			27,333,840	46.0			(4.7	)
Labor		2,287,662	3.9			2,046,295	3.4			11.8
Outsourced Production Costs		16,896,224	28.8			17,620,323	29.6			(4.1	)
Other and Overhead		271,514	0.5			253,413	0.4			7.1
Total Cost of Sales for Wholesale		45,496,583	77.5			47,253,871	79.5			(3.7	)
Gross Profit for Wholesale		13,215,340	22.5			12,214,580	20.5			8.2
Net Sales for Retail		78,729,052	100.0			40,952,753	100.0			92.2
Production Costs		24,512,666	31.1			13,081,846	31.9			87.4
Rent		27,660,235	35.1			14,895,918	36.4			85.7
Total Cost of Sales for Retail		52,172,901	66.3			27,977,764	68.3			86.5
Gross Profit for Retail		26,556,151	33.7			12,974,989	31.7			104.7
Total Cost of Sales		97,669,484	71.1			75,231,635	74.9			29.8
Gross Profit	$	39,771,491	28.9	%	$	25,189,569	25.1	%		57.9	%

Raw material costs for our wholesale business were 44.4% of our total wholesale business sales in the six months ended June 30, 2013, compared to 46.0% in the six months ended June 30, 2012.  The decrease was mainly due to decreased raw materials prices.

Labor costs for our wholesale business were 3.9% of our total wholesale business sales in the six months ended June 30, 2013, compared to 3.4% in the six months ended June 30, 2012. The increase was mainly due to the increased average salaries of employees.

Outsourced manufacturing costs for our wholesale business were 28.8% of our total sales in the six months ended June 30, 2013, compared to 29.6% in the six months ended June 30, 2012. This decrease was primarily attributable to the outsourced orders of approximately $8.3 million to our related factories in Vietnam and Cambodia, for lower manufacturing costs in the six months ended June 30, 2013.

Overhead and other expenses for our wholesale business accounted for 0.5% and 0.4% of our total sales for the six months ended June 30, 2013 and 2012 respectively.

Gross profit in our wholesale business for the six months ended June 30, 2013 was $13.2 million, an increase of 8.2% compared to the six months ended June 30, 2012. As a percentage of wholesale sales, gross profit accounted for 22.5% of our total wholesale sales for the six months ended June 30, 2013, an increase of 2.0% compared to 20.5% for the six months ended June 30, 2012. The increase was mainly due to decreased raw materials prices and outsourced manufacturing costs.

Production costs for our retail business were $24.5 million during the six months ended June 30, 2013 versus $13.1 million during the six months ended June 30, 2012. As a percentage of total retail sales, Production costs for our retail business were 31.1% of our total retail sales during the six months ended June 30, 2013, a slight decreased compared to 31.9% during the six months ended June 30, 2012.

Rent costs for our retail business were $27.7 million or 35.1% of our total retail sales during the six months ended June 30, 2013 versus $14.9 million or 36.4% during the six months ended June 30, 2012. Total rent costs increased as a result of the increase in the number of our stores. The decrease in rent costs as a percentage of total retail sales was due to an increase in same store sales in 2013.

Gross profit in our retail business for the six months ended June 30, 2013 was $26.6 million and gross margin was 33.7%. Gross profit in our retail business for the six months ended June 30, 2012 was $13.0 million and gross margin was 31.7%.

Total cost of sales for the six months ended June 30, 2013 was $97.7 million, an increase of 29.8% compared to the six months ended June 30, 2012. As a percentage of total sales, our cost of sales decreased to 71.1% for the six months ended June 30, 2013, compared to 74.9% for the six months ended June 30, 2012. Consequently, gross margin increased to 28.9% for the six months ended June 30, 2013 from 25.1% for the six months ended June 30, 2012.

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We purchase the majority of our raw materials directly from numerous local fabric and accessories suppliers. For our wholesale business, purchases from our five largest suppliers represented approximately 22.9% and 19.0% of raw material purchases for the six months ended June 30, 2013 and 2012, respectively. No one supplier provided more than 10.0% of our raw material purchases for the six months ended June 30, 2013 and 2012. For our retail business, purchases from our five largest suppliers represented approximately 31.0% and 43.9% of raw material purchases for the six months ended June 30, 2013 and 2012 respectively. No one supplier provided more than 10% of our total purchases for the six months ended June 30, 2013. One supplier provided 13.8% of our total purchases for the six months ended June 30, 2012. We have not experienced difficulty in obtaining raw materials essential to our business, and we believe we maintain good relationships with our suppliers.

Wealso purchase finished goods from contract manufacturers. For our wholesale business, purchases from our five largest contract manufacturers represented approximately 46.6% of finished goods purchases for the six months ended June 30, 2013 and 2012. Two contract manufacturers provided approximately 15.4% and 13.1% of our finished goods purchases for the six months ended June 30, 2013. Two contract manufacturers provided approximately 16.6% and 13.2% of our finished goods purchases for the six months ended June 30, 2012. For our retail business, our five largest contract manufacturers represented approximately 16.0% and 18.5% of finished goods purchases for the six months ended June 30, 2013 and 2012, respectively. No manufacturer provided more than 10% of our finished goods purchases for the six months ended June 30, 2013 and 2012. We have not experienced difficulty in obtaining finished products from our contract manufacturers and we believe we maintain good relationships with our contract manufacturers.

Selling, General and Administrative Expenses

Our selling expenses consist primarily of local transportation, unloading charges, product inspection charges, salaries for retail staff and decoration and marketing expenses associated with our retail business.

Our general and administrative expenses include administrative salaries, office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing costs and other expenses that are not directly attributable to our revenues.

Costs of our distribution network that are excluded from cost of sales consist of local transportation and unloading charges, and product inspection charges. Accordingly our gross profit amounts may not be comparable to those of other companies who include these amounts in costs of sales.

	Six months ended June 30,									Increase
	2013					2012				(Decrease) %
	(in U.S. Dollars, except for percentages)
Gross Profit	$	39,771,491		28.9	%	$	25,189,569	25.1	%		57.9	%
Operating Expenses:
Selling Expenses		21,749,402		15.8			12,800,527	12.7			69.9
General and Administrative Expenses		9,985,552		7.3			7,203,406	7.2			38.6
Total		31,734,954		23.1			20,003,933	19.9			58.6
Income from Operations	$	8,036,537		5.8	%	$	5,185,636	5.2	%		55.0	%

Selling expenses were $21.7 million in the six months ended June 30, 2013, an increase of 69.9% or $8.9 million compared to the six months ended June 30, 2012. The increase was attributable to an increase in salaries and the number of retail staff, as well as increased decoration and marketing expenses associated with the promotion of LA GO GO.

General and administrative expenses were $10.0 million in the six months ended June 30, 2013, an increase of 38.6% compared to the six months ended June 30, 2012. As a percentage of total sales, general and administrative expenses slightly increased to 7.3% of total sales for the six months ended June 30, 2013, compared to 7.2% of total sales for the six months ended June 30, 2012.

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Income from Operations

Income from operations increased 55.0% to $8.0 million for the six months ended June 30, 2013 from $5.2 million for the six months ended June 30, 2012. This increase was due to our increased gross profit.

Income from operations for our retail business was $2.7 million in the six months ended June 30, 2013 compared to $0.7 million in the six months ended June 30, 2012. As a percentage of total retail sales, income from operations increased to 3.4% of total retail sales for the six months ended June 30, 2013, compared to 1.7% of total retail sales for the six months ended June 30, 2012. The increase was due to increased gross profit in our retail business.

Income from operations for our wholesale business was $5.3 million in the six months ended June 30, 2013 compared to $4.5 million in the six months ended June 30, 2012. As a percentage of total wholesale sales, income from operations increased to 9.1% of total wholesale sales for the six months ended June 30, 2013, compared to 7.6% of total wholesale sales for the six months ended June 30, 2012. The increase was due to the decreased cost of sales for our wholesale business.

Interest Expense

Interest expense was $1.5 million for the six months ended June 30, 2013, an increase of 52.1% compared to the same period in 2012. This increase was attributable to the increased interest rates and loan amounts.

Change in fair value of derivative liability

Change in fair value of derivative liability was a gain of $0.29 million and $0.29 million, based on the Binnomial Lattice model, for the six months ended June 30, 2013 and 2012, respectively.

Income Tax Expenses

Income tax expense for the six months ended June 30, 2013 was $1.5 million, an increase of 74.8% compared to the same period of 2012. The increase was primarily due to increase in profit of LA GO GO.

Net Income

Net income for the six months ended June 30, 2013 was $5.8 million, an increase of 30.0% compared to the same period in 2012. Our diluted earnings per share were $0.39 and $0.30 for the six months ended June 30, 2013 and 2012, respectively.

Summary of Cash Flows

Net cash provided by operating activities was $5.12 million for the six months ended June 30, 2013, compared with $19.2 million during the six months ended June 30, 2012. The decrease was primarily due to a decrease in amounts due from related parties.

Net cash used in investing activities was $4.6 million for the six months ended June 30, 2013, compared with $2.1 million during the six months ended June 30, 2012. The increase was mainly due to increased equipment purchases.

Net cash provided by financing activities was $6.1 million for the six months ended June 30, 2013, compared with net cash used in financing activities of $18.7 million during the six months ended June 30, 2012. During the six months ended June 30, 2013, we repaid $45.3 million of bank loans and received bank loan proceeds of $42.2 million. Also, under the counter-guarantee agreement, we advanced $7.2 million to the related party and received $18.8 million from the related party during the six months ended June 30, 2013.

Liquidity and Capital Resources

As of June 30, 2013, we had cash and cash equivalents of $16.1 million, other current assets of $119.8 million and current liabilities of $108.7 million. We presently finance our operations primarily from cash flows from operations and bank loans and we anticipate that these will continue to be our primary sources of funds to finance our short-term cash needs.

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Bank Loans

On August 2, 2010, Goldenway entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $8.08 million (RMB50 million). The line of credit is guaranteed by Jiangsu Ever-Glory International Group Corp. (“Jiangsu Ever-Glory”), an entity controlled by Mr. Kang, the Company’s Chairman and Chief Executive Officer. The line of credit is also collateralized by the Company’s property and equipment. As of June 30, 2013, Goldenway had borrowed $8.08 million (RMB50 million) under this line of credit from Nanjing Bank with an annual interest rate of 5.88% and due on various dates from July 2013 to October 2013. Approximately $1.61 million (RMB10 million) was repaid subsequent to June 30, 2013..

On May 11, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.70 million (RMB60 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory. As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB 20 million) under this line of credit with an annual interest rate ranging from 5.88% to 6.3% and due on July 2013. Ever-Glory Apparel had also borrowed $1.15 million from Nanjing Bank with an annual interest rate of 2.28%, due in July 2013, and collateralized by approximately $1.7 million of accounts receivable from wholesale customers. At June 30, 2013, approximately $5.32 million was unused and available under this line of credit. Approximately $4.38 million was repaid subsequent to June 30, 2013..

On April 10, 2012, LA GO GO entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $3.23 million (RMB20 million). The line of credit is guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of June 30, 2013, LA GO GO had borrowed $1.62 million (RMB10 million) under this line of credit with annual interest rates ranging from 6.29% to 6.44% and due on various dates from September 2013 to October 2013. At June 30, 2013, approximately $1.61 million (RMB10 million) was unused and available under this line of credit.

On January 4, 2011, Goldenway entered into a revolving line of credit agreement for approximately $6.46 million (RMB40 million) with Shanghai Pudong Development Bank. As of June 30, 2013, Goldenway had borrowed the maximum amount available under the line of $6.46 million (RMB40 million), with an annual interest rate of 6.3%. These loans are collateralized by certain properties and land use rights of Goldenway, and are due in November 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $6.62 million (RMB 41 million) from the Bank of Communications with an annual interest rate ranging from 5.6% to 6.3% and due on various dates from October 2013 to February 2014. The loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang.  This loan is also collateralized by assets of Jiangsu Ever-Glory’s equity investee, Nanjing Knitting, under a collateral agreement executed among the Company, Jiangsu Ever-Glory, Nanjing Knitting and the bank. Ever-Glory Apparel had also borrowed $2.27 million from the Bank of Communications with an annual interest rate of 3.4%, due on various dates from July to September 2013, and collateralized by approximately $5.2 million of accounts receivable from wholesale customers.

As of June 30, 2013, LA GO GO had borrowed $0.81 million (RMB5 million) from the Bank of Communications with annual interest rate of 6.06% and due in July 2013. This loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang. Approximately $0.81 million (RMB 5 million) was repaid subsequent to June 30, 2013.

On July 29, 2011, Ever-Glory Apparel and Perfect Dream collectively entered into a secured banking facility agreement for a combined revolving import facility, letter of credit, invoice financing facilities and a credit line for treasury products of up to $7.0 million with the Nanjing Branch of HSBC (China) Company Limited (“HSBC”). This agreement is guaranteed by the Company and Mr. Kang. As of June 30, 2013, Ever-Glory Apparel had borrowed $2.42 million from HSBC with annual interest rate of 5.6%, due on various dates from July to August 2013, and collateralized by approximately $4.5 million of accounts receivable from wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of June 30, 2013, approximately $4.58 million was unused and available. Approximately $1.62 million was repaid subsequent to June 30, 2013.

On August 21, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $13.41 million (RMB83 million) with Everbright Bank guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB20 million) from Everbright Bank, with annual interest rate of 6.3% and due in September 2013. At June 30, 2013, approximately $10.18 million (RMB63 million) was unused and available under this line of credit.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.06 million from China Minsheng Bank, with annual interest rate of 2.93% and due in September 2013 and collateralized by approximately $1.6 million of accounts receivable from wholesale customers.

27

On November 16, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $4.20 million (RMB 26 million) with Bank of China guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) under this line of credit with annual interest rate of 6.05% and due on December 2013. Ever-Glory Apparel had also borrowed $4.05 million (including $1.79 million and RMB 14 million) from Bank of China with an annual interest rate ranging from 1.8% to 6.72%, due on various dates from July to September 2013, and collateralized by approximately $7.2 million of accounts receivable from wholesale customers. Approximately $0.4 million was repaid subsequent to June 30, 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $0.57 million from Ping An Bank, with annual interest rate of 6.3%, due in September 2013, and collateralized by approximately $0.72 million of accounts receivable from wholesale customers.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) from Hua Xia Bank, with annual interest rate of 6.6% and due in April 2014. This loan is guaranteed by Goldenway.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million from Hua Xia Bank, with annual interest rate of 6.3% and due in April 2014. This loan is guaranteed by Goldenway.

All bank loans are used to fund our daily operations.

Amounts due from related party

In March 2012, in consideration of the guarantees and collateral provided by Jiangsu Ever-Glory and Nanjing Knitting, the Company agreed to provide Jiangsu Ever-Glory a counter guarantee in the form of cash of not less than 70% of the maximum aggregate lines of credit obtained by the Company. Jiangsu Ever-Glory is obligated to return the full amount of the counter-guarantee funds provided upon expiration or termination of the underlying lines of credit and is to pay annual interest at the rate of 6.0% of amounts provided. As of June 30, 2013, Jiangsu Ever-Glory has provided guarantees for approximately $45.4 million (RMB 281 million) of lines of credit obtained by the Company. Jiangsu Ever-Glory, and its 20.31% owned equity investee, Nanjing Knitting, have also provided their assets as collateral for certain of these lines of credit. The value of the collateral, as per appraisals obtained by the banks in connection with these lines of credit is approximately $21.33 million (RMB 132 million).  Mr. Kang has also provided a personal guarantee for $22.46 million (RMB 139 million). During the six months ended June 30, 2013, $7.27 million (RMB45 million) was provided to Jiangsu Ever-Glory under the counter-guarantee. As of June 30, 2013, the amount of the counter-guarantee had been reduced to $21.24 million (RMB131 million), which was 46.7% of the aggregate amount of lines of credit. This amount plus accrued interest of $1.88 million have been classified as a reduction of equity, consistent with the guidance of SEC Staff Accounting Bulletins 4E and 4G.

Capital Commitments

We have a continuing program for the purpose of improving our manufacturing facilities and extending our LA GO GO stores. We anticipate that cash flows from operations and borrowings from banks will be used to pay for these capital commitments.

Uses of Liquidity

Our cash requirements for the next twelve months will be primarily to fund daily operations and the growth of our business, some of this being used to fund new stores.

Sources of Liquidity

Our primary sources of liquidity for our short-term cash needs are expected to be from cash flows generated from operations, and cash equivalents currently on hand. We believe that we will be able to borrow additional funds if necessary.

We believe our cash flows from operations together with our cash and cash equivalents currently on hand will be sufficient to meet our needs for working capital, capital expenditure and other commitments for the next twelve months. No assurance can be made that additional financing will be available to us if required, and adequate funds may not be available on terms acceptable to us. If funding is insufficient at any time in the future, we will develop or enhance our products or services and expand our business through our own cash flows from operations.

28

As of June 30, 2013, we had access to $64.9 million in lines of credit, of which $20.1 million was unused and is currently available. These credit facilities do not include any covenants.

Foreign Currency Translation Risk

Our operations are, for the most part, located in the PRC, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between the United States dollar and the Chinese RMB. Most of our sales are in United States (U.S.) dollars. During 2003 and 2004 the exchange rate of RMB to the U.S. dollar remained constant at 8.26 RMB to the dollar. On July 21, 2005, the Chinese government adjusted the exchange rate from 8.26 to 8.09 RMB to the U.S. dollar. From that time, the RMB continued to appreciate against the U.S. dollar. As of June 30, 2013, the foreign exchange rate had increased to 6.19 RMB to one U.S. dollar. We are continuously negotiating price adjustments with most of our customers based on the daily market foreign exchange rates, which we believe will reduce our exposure to exchange rate fluctuations in the future, and we will pass some of the increased cost to our customers.

In addition, the financial statements of Goldenway, New-Tailun, Catch-Luck, Ever-Glory Apparel, Tai Xin and LA GO GO (whose functional currency is the RMB) are translated into US dollars using the current rate method. The balance sheet items are translated into US dollars using the exchange rates at the respective balance sheet dates. The capital and various reserves are translated at historical exchange rates prevailing at the time of the transactions while income and expense items are translated at the average exchange rate for the period. All exchange differences are recorded within equity. The foreign currency translation gain (loss) for the three and six months ended June 30, 2013 and 2012 was $850,550, $1,158,392, $(196,365) and $200,001, respectively.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our investors.

ITEM 3.      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We do not use derivative financial instruments in our investment portfolio and have no foreign exchange contracts. Our financial instruments consist of cash and cash equivalents, trade accounts receivable, accounts payable, bank loans and long-term obligations. We consider investments in highly-liquid instruments purchased with a remaining maturity of 90 days or less from the date of purchase to be cash equivalents.

Interest Rates: Our exposure to market risk for changes in interest rates relates primarily to our short-term investments and short-term obligations; thus, fluctuations in interest rates would not have a material impact on the fair value of these securities. On June 30, 2013, we had $16.1 million in cash and cash equivalents. A hypothetical 5% increase or decrease in either the short term or long term interest rates would not have any material impact on our earnings or loss, or the fair market value or cash flows of these instruments.

Foreign Exchange Rates: We pay our suppliers and employees in Chinese RMB, however, most of our wholesales customers are located in the U.S., Japan and Europe and we generate sales from them in U.S. Dollars, Euros and British Pounds. Accordingly, our business has substantial exposure to changes in exchange rates between and among the Chinese RMB, the U.S. Dollar, the Euro and the British Pound. In the last decade, the RMB has been pegged at 8.26 RMB to one U.S. Dollar. On July 21, 2005 it was revalued to 8.09 per U.S. Dollar. Following the removal of the peg to the U.S. Dollar and pressure from the United States, the People’s Bank of China also announced that the RMB would be pegged to a basket of foreign currencies, rather than being strictly tied to the U.S. Dollar, and would be allowed to float trade within a narrow 0.3% daily band against this basket of currencies. The PRC government has stated that the basket is dominated by the U.S. Dollar, Euro, Japanese Yen and South Korean Won, with a smaller proportion made up of the British Pound, Thai Baht, Russian Ruble, Australian Dollar, Canadian Dollar and Singapore Dollar. There can be no assurance that the relationship between the RMB and these currencies will remain stable over time, especially in light of the significant political pressure on the Chinese government to permit the free flotation of the RMB, which could result in greater and more frequent fluctuations in the exchange rate between the RMB, the U.S. Dollar and the Euro. On June 30, 2013, the exchange rate between the RMB and U.S. Dollar was 6.19 RMB to one U.S. Dollar. For additional discussion regarding our foreign currency risk, see the section titled Risk Factors in the Annual Report on Form 10-K for fiscal year ended on December 31, 2012. Fluctuation in the value of Chinese RMB relative to other currencies may have a material adverse effect on our business and/or an investment in our shares.

ITEM 4.      CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934, as amended ( the “Exchange Act”)  is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Evaluation of Disclosure Controls and Procedures. As of  June 30, 2013, the end of the fiscal quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not operating effectively as of June 30, 2013. Our disclosure controls and procedures were not effective because of certain “material weaknesses” described in the “Management’s Annual Report on Internal Control over Financial Reporting” section in Item 9 of our annual report for fiscal year ended December 31, 2012.  As of June 30, 2013, we had not completed the remediation of these material weaknesses.

Limitations on the Effectiveness of Disclosure Controls.  Readers are cautioned that our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud and material error.  An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any control design will succeed in achieving its stated goals under all potential future conditions.

Changes in Internal Control over Financial Reporting

Our management has worked, and will continue to work to improve our internal controls over financial reporting. During the three months ended June 30, 2013, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

29

PART II.  OTHER INFORMATION

ITEM 1.      LEGAL PROCEEDINGS

We know of no pending legal proceedings to which we are a party which are material or potentially material, either individually or in the aggregate. We are from time to time, during the normal course of our business operations, subject to various litigation claims and legal disputes. We do not believe that the ultimate disposition of any of these matters will have a material adverse effect on our financial position, results of operations or liquidity.

ITEM 1A.   RISK FACTORS

There has been no material change in the information provided in Item 1A of Form 10-K Annual Report for the year ended December 31, 2012 filed with the SEC on April 16, 2013.

ITEM 2.      UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3.      DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.      MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.      OTHER INFORMATION

None.

ITEM 6.      EXHIBITS

The following exhibits are filed herewith:

Exhibit No.	Description
31.1	Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document (**)
101.SCH	XBRL Taxonomy Extension Schema Document (**)
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document (**)
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document (**)
101.LAB	XBRL Taxonomy Extension Label Linkbase Document (**)
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document (**)

* Filed herein

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

30

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

August 19, 2013	EVER-GLORY INTERNATIONAL GROUP, INC.
	By:	/s/ Edward Yihua Kang
		Edward Yihua Kang
		Chief Executive Officer
		(Principal Executive Officer)
	By:	/s/ Jiansong Wang
		Jiansong Wang
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

31

EX-31.1

EXHIBIT 31.1

I, Edward Yihua Kang, certify that:

1.   I have reviewed this quarterly report on Form 10-Q for the period ending June 30, 2013 of Ever-Glory International Group, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 19, 2013	/s/ Edward Yihua Kang
	Edward Yihua Kang Chief Executive Officer (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

I, Jiansong Wang, certify that:

1.   I have reviewed this quarterly report on Form 10-Q for the period ending June 30, 2013 of Ever-Glory International Group, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 19, 2013	/s/ Jiansong Wang
	Jiansong Wang
	Chief Finance Officer
	(Principal Financial Officer)

EX-32.2

EXHIBIT 32.2

Certification Pursuant To

Section 906 of Sarbanes-Oxley Act of 2002

I, Jiansong Wang, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. The Quarterly report on Form 10-Q of the Company for the quarter ended June 30, 2013 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (U.S.C. 78m or 78o(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 19, 2013	/s/ Jiansong Wang
	Chief Finance Officer
	(Principal Financial Officer)

The foregoing certification is being furnished solely pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code) and is not being filed as part of a separate disclosure document.

EX-32.1

EXHIBIT 32.1

Certification Pursuant To

Section 906 of Sarbanes-Oxley Act of 2002

I, Edward Yihua Kang, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

1. The Quarterly report on Form 10-Q of the Company for the quarter ended June 30, 2013 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (U.S.C. 78m or 78o(d)); and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 19, 2013	/s/ Edward Yihua Kang
	Edward Yihua Kang
	Chief Executive Officer
	(Principal Executive Officer)

The foregoing certification is being furnished solely pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code) and is not being filed as part of a separate disclosure document.

XML

Segments

6 Months Ended

Jun. 30, 2013

Segments [Abstract]

SEGMENTS

NOTE 12   SEGMENTS

The Company reports financial and operating information in the following two segments:

(a)  Wholesale segment

(b)  Retail segment

	Wholesale segment		Retail segment		Total
Six months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	58,711,923	$	78,729,052	$	137,440,975
Income from operations	$	5,339,873	$	2,696,664	$	8,036,537
Interest income	$	624,195	$	13,595	$	637,790
Interest expense	$	1,412,096	$	116,128	$	1,528,224
Depreciation and amortization	$	478,315	$	3,212,576	$	3,690,891
Income tax expense	$	828,834	$	649,338	$	1,478,172
Six months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	59,468,451	$	40,952,753	$	100,421,204
Income (loss) from operations	$	4,494,836	$	690,800	$	5,185,636
Interest income	$	603,785	$	6,435	$	610,220
Interest expense	$	938,754	$	65,990	$	1,004,744
Depreciation and amortization	$	498,899	$	1,798,011	$	2,296,910
Income tax expense	$	687,462	$	158,404	$	845,866

	Wholesale segment		Retail segment		Total
Three months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	27,051,468	$	32,078,017	$	59,129,485
Income from operations	$	2,547,245	$	1,520,112	$	4,067,357
Interest income	$	332,268	$	9,920	$	342,188
Interest expense	$	678,069	$	58,626	$	736,695
Depreciation and amortization	$	244,604	$	1,815,642	$	2,060,246
Income tax expense	$	400,680	$	367,861	$	768,541
Three months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	28,807,928	$	18,387,103	$	47,195,031
Income (loss) from operations	$	1,967,832	$	454,284	$	2,422,116
Interest income	$	325,486	$	3,250	$	328,736
Interest expense	$	424,193	$	34,510	$	458,703
Depreciation and amortization	$	248,435	$	887,840	$	1,136,275
Income tax expense	$	215,057	$	105,953	$	321,010

XML

Condensed Consolidated Statements of Comprehensive Income (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Consolidated Statements Of Comprehensive Income [Abstract]
NET SALES	$ 59,129,485	$ 47,195,031	$ 137,440,975	$ 100,421,204
COST OF SALES	39,650,917	33,608,450	97,669,484	75,231,635
GROSS PROFIT	19,478,568	13,586,581	39,771,491	25,189,569
OPERATING EXPENSES
Selling expenses	9,898,106	6,966,335	21,749,402	12,800,527
General and administrative expenses	5,513,105	4,198,130	9,985,552	7,203,406
Total Operating Expenses	15,411,211	11,164,465	31,734,954	20,003,933
INCOME FROM OPERATIONS	4,067,357	2,422,116	8,036,537	5,185,636
OTHER INCOME (EXPENSES)
Interest income	342,188	328,736	637,790	610,220
Interest expense	(736,695)	(458,703)	(1,528,224)	(1,004,744)
Change in fair value of derivative liability	2,000	180,000	294,000	290,800
Other income (expenses)	(179,098)	200,010	(147,641)	236,313
Total Other Income (Expenses)	(571,605)	250,043	(744,075)	(132,589)
INCOME BEFORE INCOME TAX EXPENSE	3,495,752	2,672,159	7,292,462	5,318,225
INCOME TAX EXPENSE	(768,541)	(321,010)	(1,478,172)	(845,866)
NET INCOME	2,727,211	2,351,149	5,814,290	4,472,359
OTHER COMPERHENSIVE (LOSS) INCOME
Foreign currency translation gain	850,550	(196,365)	1,158,392	200,001
COMPREHENSIVE INCOME	$ 3,577,761	$ 2,154,784	$ 6,972,682	$ 4,672,360
EARNINGS PER SHARE
Basic and diluted	$ 0.18	$ 0.16	$ 0.39	$ 0.30
Weighted average number of shares outstanding
Basic and diluted	14,777,610	14,765,942	14,775,869	14,763,815

XML

Bank Loans

6 Months Ended

Jun. 30, 2013

Bank Loans [Abstract]

BANK LOANS

NOTE 5   BANK LOANS

Bank loans represent amounts due to various banks and are generally due on demand or within one year. These loans can be renewed with the banks. Bank loans consisted of the following at June 30, 2013 and December 31, 2012:

Bank	June 30, 2013		December 31, 2012
Nanjing Bank	$	14,079,204	$	16,743,277
Shanghai Pudong Development Bank		6,464,000		7,014,833
Bank of Communications		9,703,498		6,953,834
HSBC		2,424,000		5,414,316
Everbright Bank		3,232,000		3,166,000
China Minsheng Bank	1,062,152			4,239,800
Bank of China	5,670,220			3,387,620
Ping An Bank	572,228			-
Hua xia Bank		1,616,000		-
	$	44,823,302	$	46,919,680

On August 2, 2010, Goldenway entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $8.08 million (RMB50 million). The line of credit is guaranteed by Jiangsu Ever-Glory International Group Corp. (“Jiangsu Ever-Glory”), an entity controlled by Mr. Kang, the Company’s Chairman and Chief Executive Officer. The line of credit is also collateralized by the Company’s property and equipment. As of June 30, 2013, Goldenway had borrowed $8.08 million (RMB50 million) under this line of credit from Nanjing Bank with an annual interest rate of 5.88% and due on various dates from July 2013 to October 2013. Approximately $1.61 million (RMB10 million) was repaid subsequent to June 30, 2013..

On May 11, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $9.70 million (RMB60 million) with Nanjing Bank and guaranteed by Jiangsu Ever-Glory. As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB 20 million) under this line of credit with an annual interest rate ranging from 5.88% to 6.3% and due on July 2013. Ever-Glory Apparel had also borrowed $1.15 million from Nanjing Bank with an annual interest rate of 2.28%, due in July 2013, and collateralized by approximately $1.7 million of accounts receivable from wholesale customers.  At June 30, 2013, approximately $5.32 million was unused and available under this line of credit. Approximately $4.38 million was repaid subsequent to June 30, 2013.

On April 10, 2012, LA GO GO entered into a revolving line of credit agreement with Nanjing Bank, which allows the Company to borrow up to approximately $3.23 million (RMB20 million). The line of credit is guaranteed by Jiangsu Ever-Glory and Mr. Kang. As of June 30, 2013, LA GO GO had borrowed $1.62 million (RMB10 million) under this line of credit with annual interest rates ranging from 6.29% to 6.44% and due on various dates from September 2013 to October 2013. At June 30, 2013, approximately $1.61 million (RMB10 million) was unused and available under this line of credit.

On January 4, 2011, Goldenway entered into a revolving line of credit agreement for approximately $6.46 million (RMB40 million) with Shanghai Pudong Development Bank. As of June 30, 2013, Goldenway had borrowed the maximum amount available under the line of $6.46 million (RMB40 million), with an annual interest rate of 6.3%. These loans are collateralized by certain properties and land use rights of Goldenway, and are due in November 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $6.62 million (RMB 41 million) from the Bank of Communications with an annual interest rate ranging from 5.6% to 6.3% and due on various dates from October 2013 to February 2014. The loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang.  This loan is also collateralized by assets of Jiangsu Ever-Glory’s equity investee, Nanjing Knitting, under a collateral agreement executed among the Company, Jiangsu Ever-Glory, Nanjing Knitting and the bank. Ever-Glory Apparel had also borrowed $2.27 million from the Bank of Communications with an annual interest rate of 3.4%, due on various dates from July to September 2013, and collateralized by approximately $5.2 million of accounts receivable from wholesale customers.

As of June 30, 2013, LA GO GO had borrowed $0.81 million (RMB5 million) from the Bank of Communications with annual interest rate of 6.06% and due in July 2013. This loan is guaranteed by Jiangsu Ever-Glory and Mr. Kang. Approximately $0.81 million (RMB5 million) was repaid subsequent to June 30, 2013.

On July 29, 2011, Ever-Glory Apparel and Perfect Dream collectively entered into a secured banking facility agreement for a combined revolving import facility, letter of credit, invoice financing facilities and a credit line for treasury products of up to $7.0 million with the Nanjing Branch of HSBC (China) Company Limited (“HSBC”). This agreement is guaranteed by the Company and Mr. Kang. As of June 30, 2013, Ever-Glory Apparel had borrowed $2.42 million from HSBC with annual interest rate of 5.6%, due on various dates from July to August 2013, and collateralized by approximately $4.5 million of accounts receivable from wholesale customers. These bank loans are to be repaid upon receipt of payments from customers. As of June 30, 2013, approximately $4.58 million was unused and available. Approximately $1.62 million was repaid subsequent to June 30, 2013.

On August 21, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $13.41 million (RMB83 million) with Everbright Bank guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $3.23 million (RMB20 million) from Everbright Bank, with annual interest rate of 6.3% and due in September 2013. At June 30, 2013, approximately $10.18 million (RMB63 million) was unused and available under this line of credit.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.06 million from China Minsheng Bank, with annual interest rate of 2.93% and due in September 2013 and collateralized by approximately $1.6 million of accounts receivable from wholesale customers.

On November 16, 2012, Ever-Glory Apparel entered into a line of credit agreement for approximately $4.20 million (RMB26 million) with Bank of China guaranteed by Jiangsu Ever-Glory and Mr. Kang.  The line of credit is also collateralized by assets of Jiangsu Ever-Glory under a collateral agreement executed among the Company, Jiangsu Ever-Glory and the bank.  As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) under this line of credit with annual interest rate of 6.05% and due on December 2013. Ever-Glory Apparel had also borrowed $4.05 million (including $1.79 million and RMB14 million) from Bank of China with an annual interest rate ranging from 1.8% to 6.72%, due on various dates from July to September 2013, and collateralized by approximately $7.2 million of accounts receivable from wholesale customers. Approximately $0.4 million was repaid subsequent to June 30, 2013.

As of June 30, 2013, Ever-Glory Apparel had borrowed $0.57 million from Ping An Bank, with annual interest rate of 6.3%, due in September 2013, and collateralized by approximately $0.72 million of accounts receivable from wholesale customers.

As of June 30, 2013, Ever-Glory Apparel had borrowed $1.62 million (RMB 10 million) from Hua Xia Bank, with annual interest rate of 6.6% and due in April 2014. This loan is guaranteed by Goldenway.

Total interest expense on bank loans amounted to $736,695, $1,528,224, $458,703 and $1,004,744 for the three and six months ended June 30, 2013 and 2012, respectively.

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Concentrations and Risks (Tables)

6 Months Ended

Jun. 30, 2013

Concentrations and Risks [Abstract]

Company's revenues as per geographic areas

	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
The People’s Republic of China	$	40,694,314	$	29,320,073	$	100,376,413	$	59,828,555
Germany		3,305,231		3,393,413		7,676,564		8,858,106
United Kingdom		4,961,895		4,588,231		7,826,529		7,953,390
Europe-Other		3,134,666		3,189,555		7,102,281		7,753,988
Japan		5,306,554		2,416,434		9,005,388		8,523,582
United States		1,726,825		4,287,325		5,453,800		7,503,583
Total	$	59,129,485	$	47,195,031	$	137,440,975	$	100,421,204

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2013

Significant Accounting Policies [Abstract]

Financial Instruments

Financial Instruments

Management has estimated that the carrying amounts of non-related party financial instruments approximate their fair values due to their short-term maturities. The fair value of amounts due from (to) related parties is not practicable to estimate due to the related party nature of the underlying transactions.

Fair Value Accounting

Fair Value Accounting

Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2	Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
Level 3	Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

At June 30, 2013, the Company’s financial assets (all Level 1) consist of cash placed with financial institutions that management considers to be of a high quality.

At December 31, 2012 and through mid June 2013, the Company had a derivative liability subject to recurring fair value measurement ( Level 3) with the change in fair value recognized in earnings (Note 6).

Foreign Currency Translation and Other Comprehensive Income

Foreign Currency Translation and Other Comprehensive Income

The reporting currency of the Company is the U.S. dollar. The functional currency of the Company, Ever-Glory HK and Perfect Dream Limited, a British Virgin Islands incorporated subsidiary of the Company (“Perfect Dream”), is the U.S. dollar. The functional currency of Goldenway, New Tailun, Catch-luck, Ever-Glory Apparel, Tai Xin and LA GO GO is the Chinese RMB.

For subsidiaries whose functional currency is the RMB, all assets and liabilities were translated at the exchange rate at the balance sheet date; equity was translated at historical rates and items in the statement of comprehensive income were translated at the average rate for the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income. The resulting translation gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Items in the cash flow statement are translated at the average exchange rate for the period. 

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Related Party Transactions (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of other income from Related Parties
Total	$ 7,126	$ 6,921	$ 14,088	$ 13,838
EsCeLav [Member]
Summary of other income from Related Parties
Total	3,056	2,969	6,038	5,933
Nanjing Eight-One-Five Hi-tech (M&E) Co., Ltd. [Member]
Summary of other income from Related Parties
Total	$ 4,070	$ 3,952	$ 8,050	$ 7,905

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Payable to Officers and Employees (Details) (USD $)	3 Months Ended	6 Months Ended	10 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2013
Payable to Officers and Employees [Abstract]
Interest rate on loan payable			6.00%
Total interest expense	$ 21,817	$ 57,118
Principal amount repaid to officers and employees	$ 2,381,512

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Inventories (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Schedule of inventory
Raw materials	$ 13,212,328	$ 5,687,612
Work-in-progress	14,125,834	7,296,733
Finished goods	32,836,826	36,770,852
Inventory gross	60,174,988	49,755,197
Less: allowance for obsolete inventories	(3,477,690)	(3,716,741)
Total inventories	$ 56,697,298	$ 46,038,456

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Concentrations and Risks (Details Textual)	3 Months Ended		6 Months Ended
	Jun. 30, 2013 customer manufacturer	Jun. 30, 2012 manufacturer supplier customer	Jun. 30, 2013 manufacturer customer	Jun. 30, 2012 manufacturer customer
Wholesale business [Member]
Concentrations and Risks (Textual)
Number of wholesale customer	2	2	2	2
Percentage of revenue generated from customer			11.00%
Percentage of revenues hold by wholesale customer one	14.00%	11.00%	13.00%	13.00%
Percentage of revenues hold by wholesale customer two	10.00%	11.00%	12.00%	12.00%
Number of raw materials suppliers		1
Percentage of raw materials purchases represented by supplier one		11.00%
Percentage of raw materials purchases represented by supplier two		14.00%
Number of manufacturers of finished goods	2	2	2	2
Percentage of purchased finished goods represented by manufacturer one	17.00%	19.00%	15.00%	17.00%
Percentage of purchased finished goods represented by manufacturer two	16.00%	16.00%	13.00%	13.00%
Retail business [Member]
Concentrations and Risks (Textual)
Number of raw materials suppliers	1	2		1
Percentage of raw materials purchases represented by supplier one	10.00%	11.00%		14.00%
Percentage of raw materials purchases represented by supplier two		14.00%

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Income Tax (Details Textual) (PRC [Member])	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
PRC [Member]
Income Tax (Textual)
PRC statutory rate	25.00%	25.00%	25.00%	25.00%

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Related Party Transactions (Details 2) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of sub-contracts with related parties
Sub-contracts with related parties	$ 5,102,919	$ 2,597,793	$ 9,088,426	$ 5,423,363
Nanjing Knitting [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	211,296	119,159	232,602	753,768
Nanjing Ever-Kyowa [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	255,893	246,417	523,878	411,634
Ever-Glory Vietnam [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	3,175,681	625,667	5,094,787	1,455,136
Ever-Glory Cambodia [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	1,446,661	1,594,778	3,221,188	2,781,291
EsCeLav [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	1,775	6,616	4,358	12,564
Jiangsu Ever-Glory [Member]
Summary of sub-contracts with related parties
Sub-contracts with related parties	$ 11,613	$ 5,156	$ 11,613	$ 8,970

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Income Tax (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of Pre-tax income in jurisdictions
Pre-tax income	$ 3,495,752	$ 2,672,159	$ 7,292,462	$ 5,318,225
PRC [Member]
Summary of Pre-tax income in jurisdictions
Pre-tax income	2,863,460	1,582,335	5,548,096	3,350,278
Samoa [Member]
Summary of Pre-tax income in jurisdictions
Pre-tax income	636,295	882,620	1,462,766	1,713,142
BVI [Member]
Summary of Pre-tax income in jurisdictions
Pre-tax income	(1,003)	26,204	(2,318)	(38,159)
Others [Member]
Summary of Pre-tax income in jurisdictions
Pre-tax income	$ (3,000)	$ 181,000	$ 283,918	$ 292,964

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Related Party Transactions (Details 5) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Summary of transactions
Related party transactions	$ 25,450,229	$ 33,573,977
Jiangsu Ever-Glory [Member] | Accounts Receivable [Member]
Summary of transactions
Related party transactions	1,059,477	214,226
Jiangsu Ever-Glory [Member] | Advance/(Accounts payable) [Member]
Summary of transactions
Related party transactions	1,271,387	(53,680)
Jiangsu Ever-Glory [Member] | Interest Income [Member]
Summary of transactions
Related party transactions	1,878,066	1,262,701
Jiangsu Ever-Glory [Member] | Counter guarantee deposit [Member]
Summary of transactions
Related party transactions	$ 21,241,299	$ 32,150,730

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Segments (Tables)

6 Months Ended

Jun. 30, 2013

Segments [Abstract]

Company's financial and operating information

	Wholesale segment		Retail segment		Total
Six months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	58,711,923	$	78,729,052	$	137,440,975
Income from operations	$	5,339,873	$	2,696,664	$	8,036,537
Interest income	$	624,195	$	13,595	$	637,790
Interest expense	$	1,412,096	$	116,128	$	1,528,224
Depreciation and amortization	$	478,315	$	3,212,576	$	3,690,891
Income tax expense	$	828,834	$	649,338	$	1,478,172
Six months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	59,468,451	$	40,952,753	$	100,421,204
Income (loss) from operations	$	4,494,836	$	690,800	$	5,185,636
Interest income	$	603,785	$	6,435	$	610,220
Interest expense	$	938,754	$	65,990	$	1,004,744
Depreciation and amortization	$	498,899	$	1,798,011	$	2,296,910
Income tax expense	$	687,462	$	158,404	$	845,866

	Wholesale segment		Retail segment		Total
Three months ended June 30, 2013
Segment profit or loss:
Net revenue from external customers	$	27,051,468	$	32,078,017	$	59,129,485
Income from operations	$	2,547,245	$	1,520,112	$	4,067,357
Interest income	$	332,268	$	9,920	$	342,188
Interest expense	$	678,069	$	58,626	$	736,695
Depreciation and amortization	$	244,604	$	1,815,642	$	2,060,246
Income tax expense	$	400,680	$	367,861	$	768,541
Three months ended June 30, 2012
Segment profit or loss:
Net revenue from external customers	$	28,807,928	$	18,387,103	$	47,195,031
Income (loss) from operations	$	1,967,832	$	454,284	$	2,422,116
Interest income	$	325,486	$	3,250	$	328,736
Interest expense	$	424,193	$	34,510	$	458,703
Depreciation and amortization	$	248,435	$	887,840	$	1,136,275
Income tax expense	$	215,057	$	105,953	$	321,010

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Basis of Presentation

6 Months Ended

Jun. 30, 2013

Basis of Presentation [Abstract]

BASIS OF PRESENTATION

NOTE 1   BASIS OF PRESENTATION

Ever-Glory International Group, Inc. (the “Company”), together with its subsidiaries, is an apparel manufacturer, supplier and retailer in The People's Republic of China ("China or "PRC"), with a wholesale segment and a retail segment. The Company’s wholesale business consists of recognized brands for department and specialty stores located in China, Europe, Japan and the United States. The Company’s retail business consists of flagship stores and store-in-stores for the Company’s own-brand products.

The Company’s wholesale operations are provided primarily through the Company’s wholly-owned PRC subsidiaries, Goldenway Nanjing Garments Co. Ltd. (“Goldenway”), Nanjing Catch-Luck Garments Co. Ltd. (“Catch-Luck”), Nanjing New-Tailun Garments Co. Ltd (“New-Tailun”), Ever-Glory International Group Apparel Inc.(“Ever-Glory Apparel”) and Nanjing Tai Xin Garments Trading Company Limited (“Tai Xin”), and the Company’s wholly-owned Samoa subsidiary, Ever-Glory International Group (HK) Ltd. (“Ever-Glory HK”).  The Company’s retail operations are provided through its wholly- owned subsidiary, Shanghai LA GO GO Fashion Company Limited (“LA GO GO”).

In the opinion of management, the accompanying unaudited condensed consolidated financial statements of the Company and its subsidiaries contain all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the condensed consolidated balance sheet as of June 30, 2013, the condensed consolidated statements of comprehensive income for the three and six months ended June 30, 2013 and 2012, and the condensed consolidated statements of cash flows for the six months ended June 30, 2013 and 2012. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Accordingly, they have been condensed and do not include all of the information and footnotes required by GAAP for complete financial statements. Wholesale revenues are generally higher in the third and fourth fiscal quarters, while retail revenues are generally higher in the first and fourth fiscal quarters. The results of operations for the six months ended June 30, 2013 are not necessarily indicative of the results of operations to be expected for the full fiscal year. These financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, and the Company's June 30, 2012, amended Form 10Q/A filed on May 15, 2013.

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Inventories

6 Months Ended

Jun. 30, 2013

Inventories [Abstract]

INVENTORIES

NOTE 3   INVENTORIES

 Inventories at June 30, 2013 and December 31, 2012 consisted of the following:

	June 30, 2013			December 31, 2012
Raw materials	$	13,212,328		$	5,687,612
Work-in-progress		14,125,834			7,296,733
Finished goods		32,836,826			36,770,852
		60,174,988			49,755,197
Less: allowance for obsolete inventories		(3,477,690	)		(3,716,741	)
Total inventories	$	56,697,298		$	46,038,456

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Derivative Warrant Liability

6 Months Ended

Jun. 30, 2013

Derivative Warrant Liability [Abstract]

DERIVATIVE WARRANT LIABILITY

NOTE 6   DERIVATIVE WARRANT LIABILITY

The Company had warrants outstanding to purchase an aggregate of 840,454 shares of Company common stock, which warrants required liability classification because of certain provisions that may have resulted in an adjustment to their exercise price. The warrants expired in June 2013. At the expiration date, the remaining value of the warrants not exercised ($2,000) was reduced to $0. The increase in other income resulting from the decrease in derivative warrant liability was $2,000 and $294,000 for the three and six months ended June 30, 2013, respectively, and $180,000 and $290,800 for the three and six months ended June 30, 2012, respectively.

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Payable to Officers and Employees

6 Months Ended

Jun. 30, 2013

Payable to Officers and Employees [Abstract]

PAYABLE TO OFFICERS AND EMPLOYEES

Note 4       PAYABLE TO OFFICERS AND EMPLOYEES

The Company established a plan in September 2012. Under this plan, eligible employees may make loans to the Company and earn interest equal to prevailing China bank loan interest rates, normally two to four times rates on savings accounts. The loans could be made only in the period from September 1, 2012 to December 31, 2012. The annual interest rate varies in line with changes in China bank loan interest rates. During the period from September 1, 2012 to June 30, 2013, the average loan interest rate was 6.0% and the total interest expense for the three and six-month periods ended June 30, 2013 was $21,817 and $57,118 respectively.  The total balance of $2,381,512 was repaid to the officers and employees during the three months ended June 30, 2013.

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Related Party Transactions (Details 3) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Summary of accounts payable - related parties
Total	$ 3,374,320	$ 3,158,814
Nanjing Knitting [Member]
Summary of accounts payable - related parties
Total	747,004	756,842
Nanjing Ever-Kyowa [Member]
Summary of accounts payable - related parties
Total	78,272	128,505
Ever-Glory Vietnam [Member]
Summary of accounts payable - related parties
Total	1,117,607	2,183,039
Ever-Glory Cambodia [Member]
Summary of accounts payable - related parties
Total	1,414,613	90,428
Kunshan Enjin [Member]
Summary of accounts payable - related parties
Total	$ 16,774

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Bank Loans (Details) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Schedule of bank loans
Bank loans	$ 44,823,302	$ 46,919,680
Nanjing Bank [Member]
Schedule of bank loans
Bank loans	14,079,204	16,743,277
Shanghai Pudong Development Bank [Member]
Schedule of bank loans
Bank loans	6,464,000	7,014,833
Bank of Communications [Member]
Schedule of bank loans
Bank loans	9,703,498	6,953,834
HSBC [Member]
Schedule of bank loans
Bank loans	2,424,000	5,414,316
Everbright Bank [Member]
Schedule of bank loans
Bank loans	3,232,000	3,166,000
China Minsheng Bank [Member]
Schedule of bank loans
Bank loans	1,062,152	4,239,800
Bank of China [Member]
Schedule of bank loans
Bank loans	5,670,220	3,387,620
Ping An Bank [Member]
Schedule of bank loans
Bank loans	572,228
Hua Xia Bank [Member]
Schedule of bank loans
Bank loans	$ 1,616,000

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Income Tax (Details 1) (PRC [Member])	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
PRC [Member]
Summary of Reconciliation of PRC statutory rates to the Company's effective tax rate
PRC statutory rate	25.00%	25.00%	25.00%	25.00%
Non-taxable or non-deductible items		(2.30%)	(1.40%)	(1.90%)
Effect of foreign income tax rates	(4.50%)	(8.50%)	(5.00%)	(7.90%)
Other	1.50%	(2.20%)	1.70%	0.70%
Effective income tax rate	22.00%	12.00%	20.30%	15.90%

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Stockholders' Equity (Details) (Three Independent Directors [Member], USD $)	6 Months Ended
	Jun. 30, 2013	Feb. 28, 2013
Three Independent Directors [Member]
Stockholders' Equity (Textual)
Common stock shares issued to independent directors		5,340
Common stock issued at five days average market price		$ 1.89
Number of days used to calculation average market price of common stock	Five days before the grant date

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Concentrations and Risks (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Company's revenues as per geographic areas
Net revenue	$ 59,129,485	$ 47,195,031	$ 137,440,975	$ 100,421,204
The People's Republic of China [Member]
Company's revenues as per geographic areas
Net revenue	40,694,314	29,320,073	100,376,413	59,828,555
Germany [Member]
Company's revenues as per geographic areas
Net revenue	3,305,231	3,393,413	7,676,564	8,858,106
United Kingdom [Member]
Company's revenues as per geographic areas
Net revenue	4,961,895	4,588,231	7,826,529	7,953,390
Europe-Other [Member]
Company's revenues as per geographic areas
Net revenue	3,134,666	3,189,555	7,102,281	7,753,988
Japan [Member]
Company's revenues as per geographic areas
Net revenue	5,306,554	2,416,434	9,005,388	8,523,582
United States [Member]
Company's revenues as per geographic areas
Net revenue	$ 1,726,825	$ 4,287,325	$ 5,453,800	$ 7,503,583

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Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Balance Sheets [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	14,777,610	14,772,270
Common stock, shares outstanding	14,777,610	14,772,270

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Stockholders' Equity

6 Months Ended

Jun. 30, 2013

Stockholders' Equity [Abstract]

STOCKHOLDERS' EQUITY

NOTE 9    STOCKHOLDERS’ EQUITY

On February 28, 2013, the Company issued an aggregate of 5,340 shares of its common stock to three of the Company’s independent directors as compensation for their services in the third and fourth quarters of 2012. The shares were valued at $1.89 per share, which was the average market price of the common stock for the five days before the grant date.

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)	6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 5,814,290	$ 4,472,359
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	3,690,891	2,296,910
Recovery (Provision) for obsolete inventories	(315,354)	459,213
Loss from sale of property and equipment	29,499
Change in fair value of derivative liability	(294,000)	(290,800)
Deferred income tax	555,716	563,191
Stock-based compensation	10,082	9,836
Changes in operating assets and liabilities
Accounts receivable	19,994,644	14,295,016
Inventories	(9,415,298)	(2,219,405)
Value added tax receivable	(1,177,837)	(1,591,861)
Other receivables and prepaid expenses	307,455	(295,199)
Advances on inventory purchases	(1,473,254)	(555,284)
Amounts due from related parties	(2,760,288)	10,848,191
Accounts payable	(9,577,345)	(8,594,380)
Accounts payable and other payables- related parties	123,426	(80,515)
Other payables and accrued liabilities	75,308	36,570
Value added and other taxes payable	(77,745)	(32,117)
Income tax payable	(389,778)	(90,383)
Net cash provided by operating activities	5,120,412	19,241,223
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(4,642,650)	(2,147,918)
Proceeds from sale of property and equipment	13,583
Net cash used in investing activities	(4,629,067)	(2,147,918)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from bank loans	42,227,892	24,576,457
Repayment of bank loans	(45,290,965)	(31,488,282)
Repayment of payable to officers and employees	(2,381,512)
Repayment of advances to related party	18,781,438
Advances to related party	(7,244,771)	(11,794,260)
Net cash (used in) provided by financing activities	6,092,082	(18,706,085)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	187,368	(25,764)
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	6,770,795	(1,638,544)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	9,365,958	8,822,581
CASH AND CASH EQUIVALENTS AT END OF PERIOD	16,136,753	7,184,037
Cash paid during the period for:
Interest	1,528,224	1,004,744
Income taxes	$ 1,199,771	$ 373,221

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Condensed Consolidated Balance Sheets (Unaudited) (USD $)	Jun. 30, 2013	Dec. 31, 2012
CURRENT ASSETS
Cash and cash equivalents	$ 16,136,753	$ 9,365,958
Accounts receivable	49,748,625	68,513,893
Inventories	56,697,298	46,038,456
Value added tax receivable	4,107,991	2,866,018
Other receivables and prepaid expenses	1,478,315	1,910,383
Advances on inventory purchases	5,313,877	3,596,860
Amounts due from related parties	2,405,039	8,680
Total Current Assets	135,887,898	132,300,248
LAND USE RIGHT, NET	2,823,135	2,801,472
PROPERTY AND EQUIPMENT, NET	17,352,513	16,068,735
TOTAL ASSETS	156,063,546	151,170,455
CURRENT LIABILITIES
Bank loans	44,823,302	46,919,680
Payable to officers and employees		2,341,574
Accounts payable	41,120,018	49,700,392
Accounts payable and other payables - related parties	3,374,320	3,158,814
Other payables and accrued liabilities	10,839,202	10,547,190
Value added and other taxes payable	4,198,504	4,189,211
Income tax payable	581,282	952,652
Deferred tax liabilities	3,731,695	3,109,095
Derivative liability		294,000
Total Current Liabilities	108,668,323	121,212,608
COMMITMENTS AND CONTINGENCIES
Stockholders' equity of the Company:
Preferred stock ($.001 par value, authorized 5,000,000 shares, no shares issued and outstanding
Common stock ($.001 par value, authorized 50,000,000 shares, 14,777,610 and 14,772,270 shares issued and outstanding as of June 30, 2013 and December 31, 2012, respectively	14,777	14,772
Additional paid-in capital	3,562,243	3,552,166
Retained earnings	52,588,291	46,774,001
Statutory reserve	6,317,715	6,317,715
Accumulated other comprehensive income	8,031,562	6,873,170
Amounts due from related party	(23,119,365)	(33,573,977)
Total Stockholders' Equity	47,395,223	29,957,847
TOTAL LIABILITIES AND EQUITY	$ 156,063,546	$ 151,170,455

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Bank Loans (Details Textual)	3 Months Ended		6 Months Ended										6 Months Ended					6 Months Ended						6 Months Ended								6 Months Ended											6 Months Ended				6 Months Ended				6 Months Ended
	Jun. 30, 2013 USD ($)	Jun. 30, 2012 USD ($)	Jun. 30, 2013 USD ($)	Jun. 30, 2012 USD ($)	Jun. 30, 2013 Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 La Go Go [Member] USD ($)	Jun. 30, 2013 La Go Go [Member] CNY	Jun. 30, 2013 Nanjing Bank [Member] USD ($)	Jun. 30, 2013 Nanjing Bank [Member] Goldenway [Member] USD ($)	Jun. 30, 2013 Nanjing Bank [Member] Goldenway [Member] CNY	Aug. 02, 2012 Nanjing Bank [Member] Goldenway [Member] USD ($)	Aug. 02, 2012 Nanjing Bank [Member] Goldenway [Member] CNY	Jun. 30, 2013 Nanjing Bank [Member] Goldenway [Member] Maximum [Member]	Jun. 30, 2013 Nanjing Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Nanjing Bank [Member] Ever Glory Apparel [Member] CNY	May 11, 2012 Nanjing Bank [Member] Ever Glory Apparel [Member] USD ($)	May 11, 2012 Nanjing Bank [Member] Ever Glory Apparel [Member] CNY	Jun. 30, 2013 Nanjing Bank [Member] Ever Glory Apparel [Member] Minimum [Member]	Jun. 30, 2013 Nanjing Bank [Member] Ever Glory Apparel [Member] Maximum [Member]	Jun. 30, 2013 Nanjing Bank [Member] La Go Go [Member] USD ($)	Jun. 30, 2013 Nanjing Bank [Member] La Go Go [Member] CNY	Apr. 10, 2012 Nanjing Bank [Member] La Go Go [Member] USD ($)	Apr. 10, 2012 Nanjing Bank [Member] La Go Go [Member] CNY	Jun. 30, 2013 Nanjing Bank [Member] La Go Go [Member] Minimum [Member]	Jun. 30, 2013 Nanjing Bank [Member] La Go Go [Member] Maximum [Member]	Jun. 30, 2013 Shanghai Pudong Development Bank [Member] Goldenway [Member] USD ($)	Jun. 30, 2013 Shanghai Pudong Development Bank [Member] Goldenway [Member] CNY	Jan. 04, 2011 Shanghai Pudong Development Bank [Member] Goldenway [Member] USD ($)	Jan. 04, 2011 Shanghai Pudong Development Bank [Member] Goldenway [Member] CNY	Jun. 30, 2013 Shanghai Pudong Development Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Shanghai Pudong Development Bank [Member] Ever Glory Apparel [Member] CNY	Jun. 30, 2013 Bank of Communications [Member] USD ($)	Jun. 30, 2013 Bank of Communications [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Bank of Communications [Member] Ever Glory Apparel [Member] CNY	Jun. 30, 2013 Bank of Communications [Member] Ever Glory Apparel [Member] Minimum [Member]	Jun. 30, 2013 Bank of Communications [Member] Ever Glory Apparel [Member] Maximum [Member]	Jun. 30, 2013 Bank of Communications [Member] La Go Go [Member] USD ($)	Jun. 30, 2013 Bank of Communications [Member] La Go Go [Member] CNY	Jun. 30, 2013 Bank of China [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Bank of China [Member] Ever Glory Apparel [Member] CNY	Nov. 16, 2012 Bank of China [Member] Ever Glory Apparel [Member] USD ($)	Nov. 16, 2012 Bank of China [Member] Ever Glory Apparel [Member] CNY	Jun. 30, 2013 Bank of China [Member] Ever Glory Apparel [Member] Minimum [Member]	Jun. 30, 2013 Bank of China [Member] Ever Glory Apparel [Member] Maximum [Member]	Jun. 30, 2013 HSBC [Member] Ever Glory Apparel [Member] USD ($)	Jul. 29, 2011 HSBC [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Everbright Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Everbright Bank [Member] Ever Glory Apparel [Member] CNY	Aug. 21, 2012 Everbright Bank [Member] Ever Glory Apparel [Member] USD ($)	Aug. 21, 2012 Everbright Bank [Member] Ever Glory Apparel [Member] CNY	Jun. 30, 2013 China Minsheng Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Ping An Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Hua Xia Bank [Member] Ever Glory Apparel [Member] USD ($)	Jun. 30, 2013 Hua Xia Bank [Member] Ever Glory Apparel [Member] CNY
Bank Loans (Textual)
Revolving line of credit agreement, maximum borrowing capacity											$ 8,080,000	50,000,000				$ 9,700,000	60,000,000					$ 3,230,000	20,000,000					$ 6.46	40,000,000	$ 6.46	40,000,000		$ 6,620,000	41,000,000			$ 810,000	5,000,000			$ 4,200,000	26,000,000				$ 7,000,000			$ 13,410,000	83,000,000		$ 570,000	$ 1,620,000	10,000,000
Revolving line of credit agreement, amount borrowed								1,150,000	8,080,000	50,000,000				4,380,000						1,620,000	10,000,000					6,460,000	40,000,000					2,270,000							1,620,000	10,000,000					2,420,000		3,230,000	20,000,000			1,060,000
Effective interest rate during the period								2.28%	5.88%	5.88%			6.44%					2.28%	6.63%					6.29%	6.44%	6.30%	6.30%					3.40%			5.60%	6.30%	6.06%	6.06%	6.05%	6.05%					5.60%		6.30%	6.30%			2.93%	6.30%	6.60%	6.60%
Due date of revolving line of credit agreement								July 2013	July 2013 to October 2013.	July 2013 to October 2013.				July 2013.	July 2013.					September 2013 to October 2013.	September 2013 to October 2013.					November 2013.	November 2013.					July to September 2013	July 2013 to February 2014.	July 2013 to February 2014.			July 2013.	July 2013.	December 2013.	December 2013.					July to August 2013.		Various dates from October 2013 to February 2014.	Various dates from October 2013 to February 2014.			September 2013.	September 2013.	April 2014.	April 2014.
Revolving line of credit agreement, unused capacity														5,320,000						1.61	10,000,000																								4,580,000		10,180,000	63,000,000
Due date of additional borrowing																																							July to September 2013.	July to September 2013.
Aggregate revolving line of credit agreement, additional borrowings																																							4,050,000
Revolving line of credit agreement, additional borrowings																																							1,790,000	14,000,000
Line of credit interest rate on additional borrowing																																											1.80%	6.72%
Revolving line of credit agreement, collateral amount								1,700,000																								5,200,000							7,200,000						4,500,000							720,000
Revolving line of credit agreement, repaid subsequent to current period					1,620,000	810,000	5,000,000		1,610,000	10,000,000				3,230,000	20,000,000																								400,000
Accounts receivable from wholesale customers																																																			1,600,000
Total interest expense	$ 736,695	$ 458,703	$ 1,528,224	$ 1,004,744

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Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2013

Related Party Transactions [Abstract]

Summary of other income from related parties

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
EsCeLav	$	3,056	$	2,969	$	6,038	$	5,933
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		4,070		3,952		8,050		7,905
Total	$	7,126	$	6,921	$	14,088	$	13,838

Summary of other expenses due to related parties

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Jiangsu Ever-Glory	$	12,788	$	12,403	$	25,277	$	24,822
Kunshan Enjin		8,517		6,569		16,774		13,137
Total	$	21,305	$	18,972	$	42,051	$	37,959

Summary of sub-contracts with related parties

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Nanjing Knitting	$	211,296	$	119,159	$	232,602	$	753,768
Nanjing Ever-Kyowa		255,893		246,417		523,878		411,634
Ever-Glory Vietnam		3,175,681		625,667		5,094,787		1,455,136
Ever-Glory Cambodia		1,446,661		1,594,778		3,221,188		2,781,291
EsCeLav		1,775		6,616		4,358		12,564
Jiangsu Ever-Glory		11,613		5,156		11,613		8,970
	$	5,102,919	$	2,597,793	$	9,088,426	$	5,423,363

Summary of accounts payable - related parties

	June 30, 2013		December 31, 2012
Nanjing Knitting	$	747,004	$	756,842
Nanjing Ever-Kyowa		78,272		128,505
Ever-Glory Vietnam		1,117,607		2,183,039
Ever-Glory Cambodia		1,414,613		90,428
Kunshan Enjin		16,774		-
Total	$	3,374,270	$	3,158,814

Summary of amounts due from related party

	June 30, 2013		December 31, 2012
EsCeLav	$	12,473	$	8,680
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		61,702		-
Jiangsu Ever-Glory		25,450,229		33,573,977
Total	$	25,524,404	$	33,582,657

Summary of related party transactions

Related Party	Type of transaction	June 30, 2013		December 31, 2012
Jiangsu Ever-glory	Accounts receivable	$	1,059,477	$	214,226
Jiangsu Ever-glory	Advance/(Accounts payable)		1,271,387		(53,680	)
Jiangsu Ever-glory	Interest income		1,878,066		1,262,701
Jiangsu Ever-glory	Counter guarantee deposit		21,241,299		32,150,730
Total		$	25,450,229	$	33,573,977

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Related Party Transactions (Details Textual)	3 Months Ended		6 Months Ended		1 Months Ended	3 Months Ended		6 Months Ended			3 Months Ended		6 Months Ended
	Jun. 30, 2013 USD ($)	Jun. 30, 2012 USD ($)	Jun. 30, 2013 USD ($)	Jun. 30, 2012 USD ($)	Mar. 31, 2012 Jiangsu Ever-Glory [Member]	Jun. 30, 2013 Jiangsu Ever-Glory [Member] USD ($)	Jun. 30, 2012 Jiangsu Ever-Glory [Member] USD ($)	Jun. 30, 2013 Jiangsu Ever-Glory [Member] USD ($)	Jun. 30, 2013 Jiangsu Ever-Glory [Member] CNY	Jun. 30, 2012 Jiangsu Ever-Glory [Member] USD ($)	Jun. 30, 2013 Nanjing Knitting [Member] USD ($)	Jun. 30, 2012 Nanjing Knitting [Member] USD ($)	Jun. 30, 2013 Nanjing Knitting [Member] USD ($)	Jun. 30, 2012 Nanjing Knitting [Member] USD ($)	Jun. 30, 2013 Edward Yihua Kang [Member] USD ($)	Jun. 30, 2013 Edward Yihua Kang [Member] CNY
Related Party Transactions (Textual)
Purchase of raw material											$ 101,370	$ 79,413	$ 184,608	$ 714,022
Sub-contracts with related parties	5,102,919	2,597,793	9,088,426	5,423,363		11,613	5,156	11,613		8,970	211,296	119,159	232,602	753,768
Line of credit facility, collateral amount								21,330,000	132,000,000
Guaranty on lines of credit								45,400,000	281,000,000						22,460,000	139,000,000
Minimum amount of counter guarantee								7,270,000	45,000,000
Ownership percentage in equity investee											20.31%		20.31%
Minimum percentage counter-guaranty on lines of credit					70.00%
Line of credit facility, Interest rate at expiration or termination					6.00%
Interest charged on net amounts due								0.50%	0.50%
Interest income payable to related party						340,000	330,000	640,000		610,000
Accrued interest, classified as a reduction of equity						1,880,000		1,880,000
Reduced counter guarantee amount						$ 21,240,000		$ 21,240,000	131,000,000
Reduction in counter guarantee amount as percentage of line of credit						46.70%		46.70%	46.70%

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Related Party Transactions (Details 1) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of other expenses due to related parties
Total	$ 21,305	$ 18,972	$ 42,051	$ 37,959
Jiangsu Ever-Glory [Member]
Summary of other expenses due to related parties
Total	12,788	12,403	25,277	24,822
Kunshan Enjin [Member]
Summary of other expenses due to related parties
Total	$ 8,517	$ 6,569	$ 16,774	$ 13,137

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Earnings Per Share (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of Basic and diluted earnings per share
Net income	$ 2,727,211	$ 2,351,149	$ 5,814,290	$ 4,472,359
Weighted average number of common shares- Basic and diluted	14,777,610	14,765,942	14,775,869	14,763,815
Earnings per share - Basic and diluted	$ 0.18	$ 0.16	$ 0.39	$ 0.30

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Earnings Per Share (Details Textual)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Earnings Per Share (Textual)
Antidilutive securities excluded from computation of diluted earnings per share	840,454	840,454	840,454	840,454

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Earnings Per Share

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

EARNINGS PER SHARE

NOTE 8    EARNINGS PER SHARE

The following demonstrates the calculation for earnings per share for the three and six months ended June 30, 2013 and 2012:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Net income	$	2,727,211	$	2,351,149	$	5,814,290	$	4,472,359
Weighted average number of common shares –Basic and diluted		14,777,610		14,765,942		14,775,869		14,763,815
Earnings per share –Basic and diluted	$	0.18	$	0.16	$	0.39	$	0.30

For three and six months ended June 30, 2012, the Company excluding 840,454 warrants outstanding from diluted earnings per share as they were anticipative.

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Derivative Warrant Liability (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Derivative Warrant Liability (Textual)
Common stock shares purchasable by warrants outstanding	840,454		840,454
Reduction in remaining value of warrants			At the expiration date, the remaining value of the warrants not exercised ($2,000) was reduced to 0.
Change in fair value of derivative liability	$ 2,000	$ 180,000	$ 294,000	$ 290,800
Warrants expiration date			Jun. 30, 2013

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Related Party Transactions (Details 4) (USD $)	Jun. 30, 2013	Dec. 31, 2012
Summary of amounts due from related parties
Amounts due from related party	$ 25,524,404	$ 33,582,657
EsCeLav [Member]
Summary of amounts due from related parties
Amounts due from related party	12,473	8,680
Nanjing Eight-One-Five Hi-tech (M&E) Co., Ltd. [Member]
Summary of amounts due from related parties
Amounts due from related party	61,702
Jiangsu Ever-Glory [Member]
Summary of amounts due from related parties
Amounts due from related party	$ 25,450,229	$ 33,573,977

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Concentrations and Risks

6 Months Ended

Jun. 30, 2013

Concentrations and Risks [Abstract]

CONCENTRATIONS AND RISKS

NOTE 11   CONCENTRATIONS AND RISKS

The Company extends unsecured credit to its customers in the normal course of business and generally does not require collateral. As a result, management performs ongoing credit evaluations, and the Company maintains an allowance for potential credit losses based upon its loss history and its aging analysis. Based on management’s assessment of the amount of probable credit losses, if any, in existing accounts receivable, management has concluded that no allowance for doubtful accounts is necessary at June 30, 2013 and December 31, 2012. Management reviews the allowance for doubtful accounts each reporting period based on a detailed analysis of accounts receivable. In the analysis, management primarily considers the age of the customer’s receivable and also considers the credit worthiness of the customer, the economic conditions in the customer’s industry, and general economic conditions and trends, among other factors. If any of these factors change, the Company may also change its original estimates, which could impact the level of the Company’s future allowance for doubtful accounts.  If judgments regarding the collectability of accounts receivables are incorrect, adjustments to the allowance may be required, which would reduce profitability. 

For the six-month period ended June 30, 2013, the Company had two wholesale customers that each represented approximately 11% of the Company’s revenues. For the three-month period ended June 30, 2013, the Company had two wholesale customers that represented approximately 14% and 10% of the Company’s revenues respectively, For the six-month period ended June 30, 2012, the Company had two wholesale customers that represented approximately 13% and 12% of the Company’s revenues, respectively. For the three-month period ended June 30, 2012, the Company had two wholesale customers that each represented approximately 11% of the Company’s revenues.

For the Company’s wholesale business during the three and six months ended June 30, 2013 and 2012, no supplier represented more than 10% of the total raw materials purchased.

For the Company’s retail business, the Company had no supplier that represented more than 10% of raw materials purchases during the six months ended June 30, 2013. The Company purchased 10% of  its raw materials from one supplier during the three months ended June 30, 2013. For the Company’s retail business, the Company had one supplier that represented approximately 14% of raw materials purchases during the six months ended June 30, 2012. The Company purchased 11% and 14% of its raw materials from two suppliers respectively, during the three months ended June 30, 2012.

For the wholesale business, during the six months ended June 30, 2013, the Company relied on two manufacturers for 15% and 13% of purchased finished goods, respectively. During the six months ended June 30, 2012, the Company relied on two manufacturers for 17% and 13% of purchased finished goods, respectively. During the three months ended June 30, 2013, the Company relied on two manufacturers for 17% and 16% of purchased finished goods, respectively. During the three months ended June 30, 2012, the Company relied on two manufacturers for 19% and 16% of purchased finished goods, respectively. 

For the retail business, during the three and six months ended June 30, 2013 and 2012, no supplier represented more than 10% of the total purchased finished goods.

The Company’s revenues for the three and six months ended June 30, 2013 and 2012 were earned in the following geographic areas:

	Three months ended June 30,				Six months ended June 30,
	2013		2012		2013		2012
The People’s Republic of China	$	40,694,314	$	29,320,073	$	100,376,413	$	59,828,555
Germany		3,305,231		3,393,413		7,676,564		8,858,106
United Kingdom		4,961,895		4,588,231		7,826,529		7,953,390
Europe-Other		3,134,666		3,189,555		7,102,281		7,753,988
Japan		5,306,554		2,416,434		9,005,388		8,523,582
United States		1,726,825		4,287,325		5,453,800		7,503,583
Total	$	59,129,485	$	47,195,031	$	137,440,975	$	100,421,204

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Income Tax

6 Months Ended

Jun. 30, 2013

Income Tax [Abstract]

INCOME TAX

NOTE 7   INCOME TAX

PRC pre-tax income for the three and six months ended June 30, 2013 and 2012, was taxable in the following jurisdictions.

	Three months ended					Six months ended
	June 30,					June 30,
	2013			2012		2013			2012
PRC	$	2,863,460		$	1,582,335	$	5,548,096		$	3,350,278
Samoa		636,295			882,620		1,462,766			1,713,142
BVI		(1,003	)		26,204		(2,318	)		(38,159	)
Others		(3,000	)		181,000		283,918			292,964
	$	3,495,752		$	2,672,159	$	7,292,462		$	5,318,225

The Company’s operating subsidiaries are governed by the Income Tax Law of the PRC concerning Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws (“the Income Tax Laws”). 

All PRC subsidiaries are subject to income tax at 25% statutory rate.

Perfect Dream was incorporated in the British Virgin Islands (BVI), and under the current laws of the BVI dividends and capital gains arising from the Company’s investments in the BVI are not subject to income taxes.

Ever-Glory HK was incorporated in Samoa and has no liabilities for income tax under the current laws of Samoa.

The following table reconciles the PRC statutory rates to the Company’s effective tax rate for the three and six months ended June 30, 2013 and 2012, respectively:

	Three months ended						Six months ended
	June 30,						June 30,
	2013			2012			2013			2012
PRC statutory rate		25.0	%		25.0	%		25.0	%		25.0	%
Non-taxable or non-deductible items		-			(2.3	)		(1.4	)		(1.9	)
Effect of foreign income tax rates		(4.5	)		(8.5	)		(5.0	)		(7.9	)
Other		1.5			(2.2	)		1.7			0.7
Effective income tax rate		22.0	%		12.0	%		20.3	%		15.9	%

Income tax expense for the three and six months ended June 30, 2013 and 2012 is as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Current	$	626,528	$	121,988	$	855,572	$	265,092
Deferred		142,013		199,022		622,600		580,774
Income tax expense	$	768,541	$	321,010	$	1,478,172	$	845,866

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2013

Significant Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

NOTE 2   SIGNIFICANT ACCOUNTING POLICIES

Financial Instruments

Management has estimated that the carrying amounts of non-related party financial instruments approximate their fair values due to their short-term maturities. The fair value of amounts due from (to) related parties is not practicable to estimate due to the related party nature of the underlying transactions.

Fair Value Accounting

Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below:

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2	Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;
Level 3	Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

At June 30, 2013, the Company’s financial assets (all Level 1) consist of cash placed with financial institutions that management considers to be of a high quality.

At December 31, 2012 and through mid June 2013, the Company had a derivative liability subject to recurring fair value measurement ( Level 3) with the change in fair value recognized in earnings (Note 6).

Foreign Currency Translation and Other Comprehensive Income

The reporting currency of the Company is the U.S. dollar. The functional currency of the Company, Ever-Glory HK and Perfect Dream Limited, a British Virgin Islands incorporated subsidiary of the Company (“Perfect Dream”), is the U.S. dollar. The functional currency of Goldenway, New Tailun, Catch-luck, Ever-Glory Apparel, Tai Xin and LA GO GO is the Chinese RMB.

For subsidiaries whose functional currency is the RMB, all assets and liabilities were translated at the exchange rate at the balance sheet date; equity was translated at historical rates and items in the statement of comprehensive income were translated at the average rate for the period. Translation adjustments resulting from this process are included in accumulated other comprehensive income. The resulting translation gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Items in the cash flow statement are translated at the average exchange rate for the period.

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Segments (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of segment profit or loss:
Net revenue	$ 59,129,485	$ 47,195,031	$ 137,440,975	$ 100,421,204
Income from operations	4,067,357	2,422,116	8,036,537	5,185,636
Interest income	342,188	328,736	637,790	610,220
Interest expense	736,695	458,703	1,528,224	1,004,744
Depreciation and amortization	2,060,246	1,136,275	3,690,891	2,296,910
Income tax expense	768,541	321,010	1,478,172	845,866
Wholesale segment [Member]
Summary of segment profit or loss:
Net revenue	27,051,468	28,807,928	58,711,923	59,468,451
Income from operations	2,547,245	1,967,832	5,339,873	4,494,836
Interest income	332,268	325,486	624,195	603,785
Interest expense	678,069	424,193	1,412,096	938,754
Depreciation and amortization	244,604	248,435	478,315	498,899
Income tax expense	400,680	215,057	828,834	687,462
Retail segment [Member]
Summary of segment profit or loss:
Net revenue	32,078,017	18,387,103	78,729,052	40,952,753
Income from operations	1,520,112	454,284	2,696,664	690,800
Interest income	9,920	3,250	13,595	6,435
Interest expense	58,626	34,510	116,128	65,990
Depreciation and amortization	1,815,642	887,840	3,212,576	1,798,011
Income tax expense	$ 367,861	$ 105,953	$ 649,338	$ 158,404

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Income Tax (Details 2) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2013	Jun. 30, 2012
Summary of Components of income tax expense
Current	$ 626,528	$ 121,988	$ 855,572	$ 265,092
Deferred	142,013	199,022	555,716	563,191
Income tax expense	$ 768,541	$ 321,010	$ 1,478,172	$ 845,866

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Inventories (Tables)

6 Months Ended

Jun. 30, 2013

Inventories [Abstract]

Schedule of inventory

	June 30, 2013			December 31, 2012
Raw materials	$	13,212,328		$	5,687,612
Work-in-progress		14,125,834			7,296,733
Finished goods		32,836,826			36,770,852
		60,174,988			49,755,197
Less: allowance for obsolete inventories		(3,477,690	)		(3,716,741	)
Total inventories	$	56,697,298		$	46,038,456

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Related Party Transactions

6 Months Ended

Jun. 30, 2013

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 10   RELATED PARTY TRANSACTIONS

Mr. Kang is the Company’s Chairman and Chief Executive Officer.  Ever-Glory Enterprises (H.K.) Ltd. (“Ever-Glory Enterprises”) is the Company’s major shareholder.  Mr. Xiaodong Yan is Ever-Glory Enterprises’ sole shareholder. All transactions associated with the following companies controlled by Mr. Kang or Mr. Yan are considered to be related party transactions, and it is possible that the terms of these transactions may not be the same as those that would result from transactions between unrelated parties. All related party outstanding balances are short-tem in nature and are expected to be settled in cash.

Other income from Related Parties

Included in other income for the three and six months ended June 30, 2013 and 2012 is rent revenue from entities controlled by Mr. Kang under operating lease agreements with various terms though 2015 as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
EsCeLav	$	3,056	$	2,969	$	6,038	$	5,933
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		4,070		3,952		8,050		7,905
Total	$	7,126	$	6,921	$	14,088	$	13,838

Other expenses due to Related Parties

Included in other expenses for the three and six months ended June 30, 2013 and 2012 are rent costs due to entities controlled by Mr. Kang under operating lease agreements as follows:

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Jiangsu Ever-Glory	$	12,788	$	12,403	$	25,277	$	24,822
Kunshan Enjin		8,517		6,569		16,774		13,137
Total	$	21,305	$	18,972	$	42,051	$	37,959

Purchases from, and Sub-contracts with Related Parties

For the three and six months ended June 30, 2013 and 2012, the Company purchased raw materials of $101,370, $184,608, $79,413, $714,022, respectively, from Nanjing Knitting.

In addition, the Company sub-contracted certain manufacturing work to related parties totaling $5,102,919, $9,088,426, $2,597,793, $5,423,363 for the three and six months ended June 30, 2013 and 2012, respectively. The Company provided raw materials to the sub-contractors and was charged a fixed fee for labor provided by the sub-contractors.

Sub-contracts with related parties included in cost of sales for the three and six months ended June 30, 2013 and 2012 are as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
Nanjing Knitting	$	211,296	$	119,159	$	232,602	$	753,768
Nanjing Ever-Kyowa		255,893		246,417		523,878		411,634
Ever-Glory Vietnam		3,175,681		625,667		5,094,787		1,455,136
Ever-Glory Cambodia		1,446,661		1,594,778		3,221,188		2,781,291
EsCeLav		1,775		6,616		4,358		12,564
Jiangsu Ever-Glory		11,613		5,156		11,613		8,970
	$	5,102,919	$	2,597,793	$	9,088,426	$	5,423,363

Accounts Payable – Related Parties

The Company purchases raw materials from and subcontracts some of its production to related parties. Accounts payable to related parties at June 30, 2013 and December 31, 2012 are as follows:

	June 30, 2013		December 31, 2012
Nanjing Knitting	$	747,004	$	756,842
Nanjing Ever-Kyowa		78,272		128,505
Ever-Glory Vietnam		1,117,607		2,183,039
Ever-Glory Cambodia		1,414,613		90,428
Kunshan Enjin		16,774		-
Total	$	3,374,270	$	3,158,814

Amounts Due From Related Party

The amounts due from related parties at June 30, 2013 and December 31, 2012 are as follows:

	June 30, 2013		December 31, 2012
EsCeLav	$	12,473	$	8,680
Nanjing Eight-One-Five Hi-tech (M&E) Co.,Ltd.		61,702		-
Jiangsu Ever-Glory		25,450,229		33,573,977
Total	$	25,524,404	$	33,582,657

Jiangsu Ever-Glory is an entity engaged in importing/exporting, apparel-manufacture, real-estate development, car sales and other activities. Jiangsu Ever-Glory is controlled by Mr. Kang. Because of restrictions on its ability to directly import and export products, the Company had utilized Jiangsu Ever-Glory as its agent to assist the Company with its import and export transactions and its international transportation projects since 2005. Import transactions primarily consist of purchases of raw materials and accessories designated by the Company’s customers for use in garment manufacture. Export transactions consist of the Company’s sales to foreign markets such as Japan, Europe and the United States. These transactions ceased at end of 2011.

In March 2012, in consideration of the guarantees and collateral provided by Jiangsu Ever-Glory and Nanjing Knitting, the Company agreed to provide Jiangsu Ever-Glory a counter guarantee in the form of cash of not less than 70% of the maximum aggregate lines of credit obtained by the Company. Jiangsu Ever-Glory is obligated to return the full amount of the counter-guarantee funds provided upon expiration or termination of the underlying lines of credit and is to pay annual interest at the rate of 6.0% of amounts provided. As of June 30, 2013, Jiangsu Ever-Glory has provided guarantees for approximately $45.4 million (RMB 281 million) of lines of credit obtained by the Company. Jiangsu Ever-Glory, and its 20.31% owned equity investee, Nanjing Knitting, have also provided their assets as collateral for certain of these lines of credit. The value of the collateral, as per appraisals obtained by the banks in connection with these lines of credit is approximately $21.33 million (RMB 132 million).  Mr. Kang has also provided a personal guarantee for $22.46 million (RMB 139 million). During the six months ended June 30, 2013, $7.27 million (RMB45 million) was provided to Jiangsu Ever-Glory under the counter-guarantee. As of June 30, 2013, the amount of the counter-guarantee had been reduced to $21.24 million (RMB131 million), which was 46.7% of the aggregate amount of lines of credit. This amount plus accrued interest of $1.88 million have been classified as a reduction of equity, consistent with the guidance of SEC Staff Accounting Bulletins 4E and 4G.

Interest of 0.5% is charged on net amounts due from Jiangsu Ever-Glory at each month end. Interest income for the three and six months ended June 30, 2013 and 2012 was approximately $0.34 million, $0.64 million, $0.33 million and $0.61 million, respectively.

 Following is a summary of balances at June 30, 2013 and December 31, 2012:

Related Party	Type of transaction	June 30, 2013		December 31, 2012
Jiangsu Ever-glory	Accounts receivable	$	1,059,477	$	214,226
Jiangsu Ever-glory	Advance/(Accounts payable)		1,271,387		(53,680	)
Jiangsu Ever-glory	Interest income		1,878,066		1,262,701
Jiangsu Ever-glory	Counter guarantee deposit		21,241,299		32,150,730
Total		$	25,450,229	$	33,573,977

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2013

Earnings Per Share [Abstract]

Summary of Basic and diluted earnings per share

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Net income	$	2,727,211	$	2,351,149	$	5,814,290	$	4,472,359
Weighted average number of common shares –Basic and diluted		14,777,610		14,765,942		14,775,869		14,763,815
Earnings per share –Basic and diluted	$	0.18	$	0.16	$	0.39	$	0.30

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Bank Loans (Tables)

6 Months Ended

Jun. 30, 2013

Bank Loans [Abstract]

Schedule of bank loans

Bank	June 30, 2013		December 31, 2012
Nanjing Bank	$	14,079,204	$	16,743,277
Shanghai Pudong Development Bank		6,464,000		7,014,833
Bank of Communications		9,703,498		6,953,834
HSBC		2,424,000		5,414,316
Everbright Bank		3,232,000		3,166,000
China Minsheng Bank	1,062,152			4,239,800
Bank of China	5,670,220			3,387,620
Ping An Bank	572,228			-
Hua xia Bank		1,616,000		-
	$	44,823,302	$	46,919,680

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Document and Entity Information	6 Months Ended
	Jun. 30, 2013	Aug. 07, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	Ever-Glory International Group, Inc.
Entity Central Index Key	0000943184
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		14,777,610

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Income Tax (Tables)

6 Months Ended

Jun. 30, 2013

Income Tax [Abstract]

Summary of Pre-tax income in jurisdictions

	Three months ended					Six months ended
	June 30,					June 30,
	2013			2012		2013			2012
PRC	$	2,863,460		$	1,582,335	$	5,548,096		$	3,350,278
Samoa		636,295			882,620		1,462,766			1,713,142
BVI		(1,003	)		26,204		(2,318	)		(38,159	)
Others		(3,000	)		181,000		283,918			292,964
	$	3,495,752		$	2,672,159	$	7,292,462		$	5,318,225

Summary of Reconciliation of PRC statutory rates to the Company's effective tax rate

	Three months ended						Six months ended
	June 30,						June 30,
	2013			2012			2013			2012
PRC statutory rate		25.0	%		25.0	%		25.0	%		25.0	%
Non-taxable or non-deductible items		-			(2.3	)		(1.4	)		(1.9	)
Effect of foreign income tax rates		(4.5	)		(8.5	)		(5.0	)		(7.9	)
Other		1.5			(2.2	)		1.7			0.7
Effective income tax rate		22.0	%		12.0	%		20.3	%		15.9	%

Summary of Components of income tax expense

	Three months ended				Six months ended
	June 30,				June 30,
	2013		2012		2013		2012
Current	$	626,528	$	121,988	$	855,572	$	265,092
Deferred		142,013		199,022		622,600		580,774
Income tax expense	$	768,541	$	321,010	$	1,478,172	$	845,866