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Esprit issues warning on sales, profit

By Huw Hughes

25 Aug 2022

Business

Image: Esprit

Fashion retailer Esprit, which has undergone a major transformation in recent years, has warned of a drop in profit and sales in the first half of the year.

The company said it expects a 6 percent year-on-year drop in first-half revenue to approximately 3.63 billion Hong Kong dollars (465 million euros), which it said was “primarily due to the depreciation of the euro against the Hong Kong dollar”.

Adjusted for currency effects, revenue would be up 2 percent year-on-year.

Meanwhile, Esprit expects unaudited profit attributable to shareholders of approximately 13 million Hong Kong dollars (1.67 million euros) in the first half compared to 121 million Hong Kong dollars a year earlier.

Despite the drop, it would be the second consecutive profitable half-year for the business since 2017.

The results come after major operational changes at Esprit in recent years as its owners tried to turn it around after a long period of poor trading.

In the past two years, the company relocated its headquarters back to Hong Kong and announced a new senior leadership team, including a new CEO, chief financial officer, chief product officer, and chief digital and marketing officer to “shake up” the business ahead of its international comeback.

Looking ahead at the remainder of the year, Esprit said it will “continue to focus on initiatives to drive sales, enhance operational efficiency, improvement of inventory and receivable management, paying particular attention to the fading effects of the pandemic and optimise the cost structure in order to improve the overall performance of the business”.

ESPRIT