BERLIN — Esprit Holdings Ltd. issued a profit warning Tuesday, saying the group expects to record a substantial loss for the second half of the fiscal year ending June 30 relating to its business in China.
The Hong Kong-based group said there would be a good will impairment for the six-month period ended Dec. 31, relating to its acquisition of the remaining interests of associated companies in China. The impairment charge will be in the range of 1.8 billion to 2 billion Hong Kong dollars, or $213.9 million to $257.7 million at current exchange.
Moreover, Esprit attributed the expected loss to the closure of around 16 loss-making stores for an estimated cost of between 250 million to 300 million Hong Kong dollars, or $32.2 million to $38.7 million.
In provisional figures also released Tuesday, Esprit reported a 7.9 percent dip in sales for the third quarter ended March 31 to $6.72 billion Hong Kong dollars, or $865.8 million at an average exchange rate for the period.
The group’s retail sales were down 7.1 percent in the quarter, while its wholesale business dropped 8.8 percent. While it did not issue figures, Esprit said the group’s gross profit margin for the quarter recorded a slight decline year-on-year due to promotional activities and wholesale support measures.
For the nine months ended March 31, total sales were down 15.5 percent, with women’s casualwear, which makes up 30 percent of sales, booking the deepest declines of 26.3 percent.
From overseeing America’s fastest-growing speciality retailers to codifying cool, WWD talked to the women who are leading the way for the future of beauty. Check out our Instagram Stories to see how these women built today and are creating tomorrow. (📸: @hannah_khymych) #wwdbeauty
For @laperlalingerie's spring 2018 show, the brand chose to host their event at @thevenetianmacao. With Chinese megastars @bingbing_fan and @hubing in attendance, La Perla debuted a rock ‘n’ roll-inspired collection. The show marked the start of Sands Macao Fashion Week, which runs from October 19 to 24 — the city’s first such event. Pictured here are models backstage with glimmering eyes. #wwdfashion (📷: Cheuk-Yin To)
Trending for spring 2018: top stitch design. Gone are the days of stitch just for seams — designers are using the once-minimal detail to create strong decorative elements. (📷: Paola Testa; Styled by @andrew_shang) #wwdfashion
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)