Fashion chain Esprit went through a weak first half of its fiscal year 2017/2018, mainly because it attracted fewer visitors and therefore generated lower turnover in its physical store network over the course of its second quarter.
Esprit’s turnover reached 8.039 billion Hongkong dollars (840 million euro) in the first six months of the year, which is down 9.6 % compared to last year and prior to exchange rate fluctuations. Taking those into account, turnover dropped another 3.4 %. A drop was to be expected, seeing how Esprit is currently still restructuring its store network, which will be downsized. However, the drop is well below what was expected. Over the past six months, it shed some 7.4 % in store space.
A one-time 822 million Hong Kong dollar expense (90 million euro) resulted in a 954 million Hong Kong dollar (100 million euro) loss. Compare that to the year before when it still managed a 6.5 million euro profit. “It is important to indicate that the majority of the loss comes from our Chinese divestment and the costs related to that move”, CFO Thomas Tang said in a press release.
Over the next few months, Esprit will continue to fous on the recently-announced new strategy, which is to cut store space and to market the Esprit brand once more.