Giordano issues profit warning to Stakeholders
In this article (5)
Giordano International expects profit attributable to shareholders to fall by about 38 percent for the December year, based on a preliminary review of accounts.
The fashion label issued a statement to the Hong Kong Stock Exchange warning shareholders ahead of a formal results announcement scheduled for March.
Chairman and CEO Peter Lau said that while the decline in part followed the adoption of new Hong Kong Financial Reporting Standards 16 regarding leases, which took effect on January 1 last year and the impairment loss on right-of-use assets, it also reflected trading conditions.
“The board is of the view that the decrease is largely confined to Greater China markets, and primarily attributable to, among other matters, the weak retail environment in those regions stemming from the Sino-US trade dispute, an unseasonably warm winter and social issues.”
He said that despite the decrease which may be recorded in unaudited profit, the board considers the group’s overall business in non-Greater China markets remains healthy and the board remains positive on the long-term prospects of the group.
Questions & Answers
Q.What is the expected profit decrease for Giordano International?
What is the expected profit decrease for Giordano International?
Giordano International anticipates a profit decrease of approximately 38 percent attributable to shareholders for the December year. This is based on a preliminary review of accounts, ahead of the formal results announcement in March.
Q.Which specific regions are most affected by the profit decline?
Which specific regions are most affected by the profit decline?
The board believes the profit decrease is largely confined to the Greater China markets. This region has been impacted by the weak retail environment, the Sino-US trade dispute, and social issues.
Q.What factors are contributing to this expected fall in profit?
What factors are contributing to this expected fall in profit?
Contributing factors include the adoption of new Hong Kong Financial Reporting Standards 16, an impairment loss on right-of-use assets, and challenging trading conditions. A weak retail environment, unseasonably warm winter, and social issues in Greater China also played a part.
Q.Does this profit warning affect Giordano's business outside of Greater China?
Does this profit warning affect Giordano's business outside of Greater China?
No, the board considers the group’s overall business in non-Greater China markets to remain healthy. They remain positive about the group's long-term prospects despite the decrease in unaudited profit.