Hong Kong beauty chain Bonjour warns of another loss
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Bonjour Holdings has warned of a loss as high as US$12 million for the half-year to June as it weighs the impact of protest activity and the Covid-19-driven lockdown of the border with Mainland China.
In a profit warning, the health & beauty retail group said a preliminary, unaudited review of its results suggests a loss “not less than 300 percent” of that of the same period last year when it finished the period $3.8 million in the red.
Besides the decline in inbound tourists to the territory, local consumer sentiment weakened during the six months.
The company has also booked impairment provisions related to assets and property, and inventories resulting from losses at its retail stores, but such provisions are by nature noncash and have no impact on the group’s cash flow or liquidity.
Confirmed results will be released at the end of this month.
In April, Bonjour said it was delisting slow-moving products and had trimmed its store network to compensate for falling sales after reporting a full-year loss of $16.7 million.
In May, the husband-and-wife founders of the company stepped back from their senior leadership roles, with Dr Wilson Ip Chun Heng resigning as chairman and CEO, and his wife, Chung Pui Wan, stepping down as vice-chairman. Both remained on the board.
Questions & Answers
Q.What is the expected loss for Bonjour Holdings for the first half of the year?
What is the expected loss for Bonjour Holdings for the first half of the year?
Bonjour Holdings expects a loss of at least US$12 million for the half-year to June. This is not less than 300 percent of the loss from the same period last year.
Q.What are the main reasons cited for the expected financial loss?
What are the main reasons cited for the expected financial loss?
The company points to the impact of protest activity, the Covid-19-driven border lockdown, a decline in inbound tourists, and weakened local consumer sentiment.
Q.What actions has Bonjour Holdings taken recently to address its financial situation?
What actions has Bonjour Holdings taken recently to address its financial situation?
The company has delisted slow-moving products and trimmed its store network to compensate for falling sales. Its founders also stepped back from senior leadership roles.
Q.Will the impairment provisions affect the company's immediate cash position?
Will the impairment provisions affect the company's immediate cash position?
No, the impairment provisions related to assets, property, and inventories are noncash by nature. They will have no impact on the group’s cash flow or liquidity.
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