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Esprit Q3 Sales Slide 7.8 Percent

The retailer, which is restructuring its business, noted improved retails comps for the quarter.

HONG KONG — Esprit Holdings Ltd. said Wednesday that its comparable retail sales improved in the third quarter but its consolidated revenue still fell for the period.

Overall, group revenue for the three months ended March 31 declined 7.8 percent in local current terms. Comparable sales, excluding newly opened locations, rose 0.5 percent. Comps in Europe, the company’s largest market, rose 2.8 percent. The company did not disclose sales figures for the quarter.
 
The retailer, which unveiled a dramatic makeover plan last year, also said that it completed the divestment of its North American retail operations, with the last store shuttered in April. The company will gain a write back of 700 million Hong Kong dollars, or $90 million, from the store closures.
 
Total revenue for the nine-month period ending in March declined 7.2 percent 24 billion Hong Kong dollars, or $3.1 billion. Revenue from Europe, which makes up about 79 percent of the total, declined by 7.8 percent to 18.9 billion Hong Kong dollars, or $2.4 billion.
 
Esprit has been working to revamp its image and company structure, admitting to having “lost its soul”. In addition to the decision to divest operations in North America, the plan also included exits from Spain, Denmark and Sweden as well as closures of additional unprofitable stores elsewhere in order to focus on better performing markets. In its filing with the Hong Kong stock exchange Wednesday, the retailer said it has opened a total of 11 net new directly managed retail stores in Europe and 32 in Asia Pacific over the last nine months.
 
Esprit has also been working on opening new concept stores in Europe, starting with one in Cologne, Germany. Following the success of that store, the company said it identified 14 other stores for refurbishment to be reopened in the second half of the fiscal year, which starts in June.
 
Esprit has also made plans to open a design center in China as well as a trend division, which are scheduled to deliver their first collections in August and September. The company also said it expects its newly centralized sourcing department to save 1 billion Hong Kong dollars, or $128.8 million, a year starting in fiscal year 2014-2015.