Daphne International expects loss to balloon
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Footwear products group Daphne International Holdings expects its net loss to balloon by more than half for the year ended December 31.
Five main factors are listed for the projected loss by Daphne, which makes, distributes and retails its products and accessories…
- A significant decrease in sales.
- Negative same-store sales growth.
- Lower gross profit margin resulting from aggressive clearance efforts and a higher
weighting of aged products in the overall sales mix. - Operational charges related to inventory and store rationalisation.
However, the group says its net cash position has improved and the inventory level lowered as a result of the liquidation of aged inventory.
Also, the group’s eCommerce activities continued to achieve sales growth.
Daphne says its announcement is based on a preliminary assessment, with its annual results expected to be published in late March.
Questions & Answers
Q.What are the primary reasons Daphne International expects its net loss to increase?
What are the primary reasons Daphne International expects its net loss to increase?
A significant decrease in sales, negative same-store sales growth, and a lower gross profit margin from clearance efforts and aged products are key factors. Operational charges for inventory and store rationalisation also contributed to the projected loss.
Q.Did any areas of Daphne International's business show improvement despite the expected loss?
Did any areas of Daphne International's business show improvement despite the expected loss?
Yes, the group's net cash position has improved, and inventory levels were lowered following the liquidation of aged stock. Also, Daphne's eCommerce activities continued to achieve sales growth during the period.
Q.When can investors expect the full financial results from Daphne International?
When can investors expect the full financial results from Daphne International?
Daphne International has stated that its announcement is based on a preliminary assessment. The company expects to publish its full annual results for the year ended December 31 in late March.
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