In the first half of its financial year 2018-2019, fashion chain Esprit once more saw its turnover decrease and its losses accumulate. The company will keep cutting costs, hoping to break even again within two to three years.
Period of transition
Esprit generated a turnover of 6.77 billion Hong Kong dollars (760 million euros) over the past six months, a 14.4 % drop compared to the same period last year. The decline is due to the store network's restructuring, as well as disappointing sales. Although optimisation has helped to lower the operational costs, the company still lost 1.77 billion dollars (200 million euros). The restructurings entailed a number of non-recurring expenses, which heavily affected the result.
Esprit has been in trouble for a while now, and it is going through a major restructuring. CEO Anders Kristiansen is expecting a period of transition for the next two financial years, reducing complexity downsizing the organisation. By improving the products and creating a clearer brand identity, the company hopes growth will follow again afterwards.