- Don-Alvin Adegeest |
Sales at Esprit have plummeted during the pandemic, as the company posted a 23,65 percent drop in revenue.
After a promising start to the year, the Hong Kong based retailer saw a tangible shrinking of its sales and profits. The group recorded revenues of 9.87 billion Hong Kong dollars (approximately 1.07 billion euros), with gross profit down 33,69 percent.
“In general, the financial performance of the group during FY 19/20 has been split into two. During the first half of the year, the group continued to execute the strategic plan presented in 2018 to restore Esprit to sustainable growth and profitability.” In the first half of the year, “the group’s commitment led to successful results, in line with the group’s expectations,” the note continues, and “further positive effects were starting to be visible in the second half of the year, but the development is was abruptly interrupted by the outbreak of Covid-19,” which led to the closure of physical stores.
In this context, “e-commerce revenues was the only channel to generate revenue, while salaries, rents and operating costs continued to accrue”.
As for the current year, “the first quarter FY 20/21 is already promising and encourages the group to strictly follow the restructuring plans to bring Esprit back to profitability within the next two years.”