Sales at Esprit continue to decline
In the nine months ending 31 March, German clothing manufacturer Esprit saw group sales fall by 10.9% to 12.21 billion Hong Kong dollars (1.43 billion euros), or by 9.4% on a currency-adjusted basis. The company’s Asia-Pacific region reported the weakest performance, down by 20.1% year-on-year, but Germany and the Rest of Europe also had falls of 7.1% and 11.9% respectively.
The largest drop in sales came from the brand’s Kidswear division due to the licensing of this business to Groupe Zannier (now Kidiliz) since January 2016.
The company also said the closure of unprofitable stores, a measure it has taken to improve its results on a long term, also impacted revenue in the third quarter. The group closed a total of 4,408 sq mts of retail space during the three months to 31 March.
Third quarter revenue fell by 11.5% to 3.89 billion Hong Kong dollars (457.7 million euros), or 8.4% in local currency. According to management, the financial performance is in line with expectations and the fourth quarter is predicted to see a similar development.
Esprit is amid a restructuring which includes closing unprofitable stores, reduction of promotional activities and markdowns and streamlining operating costs.
Esprit currently operates 6,137 stores in 40 countries. The company is headquartered in Ratingen, Germany Düsseldorf and in Hong Kong.
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