Oriental Watch issues profit warning
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Slow-moving stock and falling sales due to the Covid-19 pandemic have prompted listed Hong Kong timepiece retailer Oriental Watch to issue a profit warning.
The company has advised the stock exchange that net profit for the year to March 31 will fall by about 20 percent.
Furthermore, for the two months ended May 31, the group’s revenue decreased by more than 10 percent compared with last year (when sales were impacted by social unrest in the territory).
During the quarter to March, Oriental Watch has allowed for impairment of assets, plant and equipment and provisioned for “slow-moving watches”.
“There has been no change in the group’s operation as a result of the Covid-19 outbreak and its financial position continues to be strong,” said chairman Yeung Ming Biu in the filing.
Questions & Answers
Q.What is the expected profit reduction for Oriental Watch this financial year?
What is the expected profit reduction for Oriental Watch this financial year?
Oriental Watch has informed the stock exchange that its net profit for the year ending March 31 is projected to decrease by approximately 20 percent. This warning comes amidst challenging market conditions for the timepiece retailer.
Q.What was the revenue performance like for the two months to May 31?
What was the revenue performance like for the two months to May 31?
For the two-month period ending May 31, the group's revenue saw a decline of over 10 percent compared to the previous year. This drop follows a period when sales were already affected by social unrest in the territory.
Q.Has the company taken any specific financial measures recently?
Has the company taken any specific financial measures recently?
During the quarter to March, Oriental Watch made allowances for the impairment of assets, plant, and equipment. They also provisioned specifically for slow-moving watch inventory, indicating steps to address current stock issues.
Q.How has the Covid-19 outbreak affected the company's operations or financial standing?
How has the Covid-19 outbreak affected the company's operations or financial standing?
According to chairman Yeung Ming Biu, there has been no change to the group's operations as a direct result of the Covid-19 outbreak. He also stated that the company's financial position remains strong.
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