HONG KONG — Esprit Holdings Ltd. said third-quarter revenue dropped 9.9 percent to 6.05 billion Hong Kong dollars, or $780.3 million, as the company continued closing unprofitable retail space and Asia Pacific sales were weaker than expected.
Esprit also blamed a calendar effect — with Easter and mid-season spring sales falling in March this year, compared with April last year — for the drop in business.
In the quarter ended March 31, retail sales in Asia Pacific, totaling nearly 13 percent of total company revenues, came to 782 billion Hong Kong dollars, or $100.8 million, down 18.2 percent versus the same prior-year period. By contrast, retail sales in Europe declined 1 percent to 2.58 billion Hong Kong dollars, or $332 million.
Wholesale revenue also retreated amid a “rationalization” of the business. They were down 14.3 percent to 2.49 billion Hong Kong dollars, or $321 million. Asia Pacific wholesale revenue declined more, falling 58.1 percent, while it dipped 9.1 percent in Europe.
The Hong Kong dollar is pegged to the U.S. dollar.
For the nine-month period ended March 31, Esprit revenue was down 7 percent to 18.86 billion Hong Kong dollars, or $2.4 billion. Asia Pacific retail sales fell 16.3 percent during the period, while European retail sales rose 3.2 percent. Total wholesale revenue, which makes up 38 percent of the business, declined 12.7 percent with Asia Pacific down 42.3 percent and Europe retreating 7.6 percent. Esprit shuttered a North American wholesale operation.
The unaudited results were filed with the Hong Kong Stock Exchange on Wednesday.