Hong Kong leads ‘drastic’ drop in sales for Giordano
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A “drastic” drop in sales has led apparel retailer Giordano International to record a US$22.6 million loss in the six months to June, of which $13.2 million alone was attributable to its Hong Kong operations.
The company said in a stock-exchange filing that post-June 30, sales have begun to recover, but while it continues to assess the impact of the Covid-19 crisis on its operations it is too soon to project its full-year performance.
Last year’s first half saw the company report a net profit of $20.8 million.
Group-wide sales fell by 44.4 percent for the half-year to $182 million, with the impact of Covid-19 beginning in January in Mainland China, leading to a ban on cross-border travel from Mainland China into Hong Kong and Macau.
Non-cash provisions relating to Hong Kong accounting laws also contributed to the loss.
Online sales surged 93.8 percent during the six months to $17.9 million, accounting for 9.8 percent of total group turnover, nearly double the share of the same period last year.
Giordano’s chairman and CEO Peter Lau said the group will continue to focus on third-party online platforms for future growth.
Giordano operated 2187 stores at the end of June.
Questions & Answers
Q.What was the main financial outcome for Giordano in the first half of the year?
What was the main financial outcome for Giordano in the first half of the year?
Giordano recorded a US$22.6 million loss for the six months to June. This drastic drop in sales contrasts with a net profit of $20.8 million during the same period last year.
Q.How significantly did Hong Kong operations contribute to the company's loss?
How significantly did Hong Kong operations contribute to the company's loss?
Of the total US$22.6 million loss, $13.2 million was specifically attributable to its Hong Kong operations. Non-cash provisions related to Hong Kong accounting laws also contributed to this.
Q.What impact did online sales have on the company's performance during this period?
What impact did online sales have on the company's performance during this period?
Online sales surged by 93.8 percent to $17.9 million, representing 9.8 percent of total group turnover. This share was nearly double that of the same period in the previous year.
Q.What was the total decline in sales across the group for the half-year?
What was the total decline in sales across the group for the half-year?
Group-wide sales fell by 44.4 percent for the half-year, amounting to $182 million. This decline began in January due to Covid-19, particularly affecting cross-border travel into Hong Kong and Macau.
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