Esprit : Fashion group Esprit sees H1 loss on declining stores sales
HONG KONG: Esprit Holdings Ltd said it expected to post losses in the
fiscal first half, ended in December 2017, hit by weak sales at its
brick-and-mortar retail stores as the fashion group rationalized its
distribution footprint and a decline in China business.The Europe-focused
clothing retailer expected to post a net loss of up to HK$980 million ($125.4
million) for July-December period, as compared with HK$61 million profit in the
year-ago period, the company said in a filing late on Wednesday.
Esprit said its
gross profit margin had slightly increased and operating expenses had further
reduced, but were not sufficient to outweigh the negative impact of the revenue
decline during the period.The operating environment continues to be "very
challenging" amid the rapidly-changing industry dynamics, and the
financial performance in the second half remains "uncertain", the
company added. It is due to release the interim results on Feb. 28.
Esprit
is undergoing a multi-year revamp that includes store closures, price
adjustments, new return policies, and technology and distribution upgrades.It
said in November it would continue downsizing effort to accelerate closure of
loss-making retail stores and expect improvement in gross profit margin and
operating expenses to outweigh the negative impact of revenue decline.The
company has expected controlled retail space to shrink by single digits in
percentage terms in the current financial year with falling revenue.Esprit
shares dived more than 15 percent in early trade at HK$3.44, their lowest since
April 1999.
Source: Et.retail.com,India
Thursday, 25 January 2018