Esprit continues to report revenue decline in Q1

For the first quarter ended September 30, 2018, Esprit continued to report weakness in revenue as a result of declining customers’ traffic and extended warm summer temperature in Europe which impacted sales of autumn merchandise. Esprit’s revenue amounted to 3,334 million Honk Kong dollars (425 million dollars), a decline of 16.2 percent in local currency term (LCY) compared to the corresponding reduction in total controlled space of 10.6 percent.

The company added that retail excluding eshop, representing 37percent of group revenue, recorded a revenue decline of 17.8 percent in LCY due to reduction in net sales area of 11.5 percent as a result of continued rationalization of distribution footprint, including the closure of the Australia and New Zealand markets in Asia Pacific (APAC), and decline in comparable retail store sales of 14.1 percent in LCY, mainly due to declining customers’ traffic to stores and extended warm summer temperature in Europe which impacted sales of autumn merchandise. The comparable retail store sales in APAC (excl. eshop) recorded a growth of 0.3 percent in LCY due to promotional activities.

Eshop, representing 24.9 percent of group revenue, recorded a revenue decrease of 14.9 percent in LCY. Eshop Europe (including Germany) accounted for 97.4 percent of total eshop revenue and reported revenue decline of 14.1 percent in LCY. Similar to brick and mortar retail, the company further said, negative development was mainly due to lower consumers’ traffic. As for eshop APAC, it accounted for 2.6% of total eshop revenue, reported a decline of 36.7 percent in LCY mainly due to the closure of ANZ eshop in July 2018; and the decline in consumers’ traffic to the company’s eshop on Tmall.

Wholesale represents 37.3 percent of group revenue, reported a decline of 15.5 percent in LCY, as compared to the corresponding reduction in controlled space of 9.8 percent. German and rest of Europe wholesale accounted for 97.5 percent of wholesale revenue, recorded 16.1 percent and 15.1 percent decline in revenue in LCY, respectively, while revenues of APAC wholesale declined 11 percent in LCY.

Picture:Facebook/Esprit