Hong Kong-listed Esprit Holdings has posted a forecast-beating 5.2% fall in profit for its fiscal first half, saying it aims to expand its Chinese business and broaden its footprint in Asia to improve its overall sales.
In face of the weakened wholesale and retail environments in Europe, the retailer will redirect its capital to expand its penetration in the mainland from its current presence of 150 cities to more than 450 cities instead.
"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."
Esprit said it maintained a target of 5-10% year-on-year growth in retail selling space for the full financial year that runs through the first half of 2010.
The company said growth in the mainland and more favourable currency movements should help it swing back to net profit growth in the current second half of its fiscal year, including higher revenue contributions after the recent buyout of its mainland venture.
