Gross margin growth helps Esprit post first profit in five years
Recovered clothing retailer Esprit has increased its gross margin by 7% in the past six months, en route to its first profit in five years.
Sales reached US$1.06 billion with profit attributable to shareholders of US$48.7 million, compared to a loss of US$52.9 million in the previous corresponding period. The company’s gross margin reached 48.6%.
In a statement, the company said the turnaround was also due to new infrastructure and strategies adopted by the new management team, cost control measures, improved inventory management and growth in sales. online sales. Certain strategic functions have been transferred from Germany to Hong Kong, where the company is listed on the stock exchange and where its management team is now based.
“Combining the expertise of both offices has created a stronger organizational balance and workplace synergy,” said William Pak, Executive Director, CEO and COO.
“We will continue to strengthen Esprit by becoming a truly ubiquitous brand and enhancing our product portfolio that aligns with the company’s mission to make our customers ‘feel good to look good’,” he said. declared.
The improved performance was achieved despite the loss of revenue due to Covid-related lockdowns in Esprit’s main European markets during the first quarter of last year and store entry restrictions in the fourth quarter. This was balanced by selling more shares at full price and less at discount.
Despite the impact of Covid, the company is optimistic about its future prospects.
“While there are major near-term uncertainties for the global economy in general, the group will remain connected and remain agile to respond quickly to any challenges that may arise,” said Christin Chiui, Chairman and Chief Executive Officer.
“The company has already begun to revitalize the Esprit brand and leverage the company’s performance in 2021 to drive more sustainable business growth in 2022.”