Hong Kong-based Esprit Holdings Ltd. said it anticipates posting a “slight profit” in the first six months of its fiscal year as it cuts costs and continues its restructuring efforts.
The company posted a loss in the year-earlier period, running July 1 through Dec. 31. Esprit’s fiscal year ends June 30.
Esprit said its prediction is based on a preliminary assessment of the first half of the year. It also warned that the “operating environment continues to be very challenging.” Esprit said it’s important to remember that the company normally does not perform as well in the second half of the year as the first half due to the seasonality of the retail business.
“Hence, the financial performance of the Group in the second half of [fiscal year 2013-14] remains uncertain,” the company said. It declined to provide any profit or sales forecasts.
The company said that in September it posted a comprehensive net loss of 3.78 billion Hong Kong dollars, or $487.29 million, for the year ended June 30, compared with a year-earlier loss of 366 million Hong Kong dollars, or $47.18 million. The Hong Kong dollar is pegged to the U.S. dollar.
Full-year sales declined 14.1 percent to 25.90 billion Hong Kong dollars, or $3.34 billion, on a “weak” performance at retail and a strategic move to divest the brand’s North American operations.
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