Esprit Plans China Expansion

Esprit Holdings (Hong Kong) says it plans to expand its China network and broaden its footprint in Asia, growing to 450 stores from its current 150 locations. The announcement comes at the same time the specialty retailer reports its retail same-store sales grew 0.4 percent during second fiscal quarter against a drop of 3.5 percent in the first.

Revenue from its retail business rose 9.5 percent during the period as it increased prices, while turnover from wholesale was down 13.9 percent from a year earlier. Profits dropped 5.2 percent for the fiscal first half, beating forecast estimates.

“We believe China will become one of the most important growth engines of the group in the medium term,” the company said in a statement. “It also represents an important step for the group in becoming a truly global company as it will strengthen our presence in Asia-Pacific considerably, hence improving our geographical balance further.”

The fashion group expects its growth in China and more favorable currency movements to help it swing back to net profit growth in the current second half of its fiscal year.
In December, Esprit announced it would downsize the number of new stores planned for the current fiscal year from 60-80 to 50.