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Tag: Giordano

  • Giordano Reports Q3 Sales Dip Despite Yearly Growth; E-commerce Revenue Soars By 16.5%

    Giordano Reports Q3 Sales Dip Despite Yearly Growth; E-commerce Revenue Soars By 16.5%

    Hong Kong-based fashion retail giant, Giordano, has experienced a decrease in sales for the third quarter of the year, despite an overall positive performance for the year so far.

    Q3 Performance

    The retailer’s third-quarter revenue, ending on September 30, dropped by 1.4 per cent to HK$894 million, equivalent to US$115 million. Sales declined by 8.5 per cent in Southeast Asia and Australia, remained unchanged in Greater China, but impressively jumped by 11.6 per cent in the Gulf Cooperation Council.

    Giordano’s e-commerce revenue continued to demonstrate strong progress with an increase of 16.5 per cent, even as offline sales fell by 4.9 per cent. Same-store sales also experienced a slight dip, declining by 0.5 per cent.

    Strategic Initiatives

    Giordano’s management shared that the company has been actively shifting towards high-growth channels and markets as part of its strategic initiatives. They added, “With a focused approach, we are successfully navigating a period of reset with a view to delivering long-term sustainable growth in line with our strategic vision.”

    Performance for the First Nine Months

    The retailer’s performance for the first nine months of the year remained in the green, with a modest revenue increase of 0.6 per cent.

    Despite challenges like unprecedented adverse weather in Greater China, the company’s core business preserved stability with a 0.4 per cent growth in the quarter and a 2.7 per cent growth for the year so far.

    The quarter ended with Giordano operating 1,627 stores, marking a net reduction of 122 locations since the start of the year. As part of their inventory optimization plans, inventory also declined by 2.9 per cent year-to-date.

    Questions & Answers

    What is Giordano’s percentage of sales decline in the third quarter?
    Sales declined by 1.4 per cent, equivalent to HK$894 million, or US$115 million.

    How has Giordano’s e-commerce revenue been performing?
    Giordano’s e-commerce revenue demonstrated strong progress with an increase of 16.5 per cent.

    What is the net change in Giordano’s store count since the beginning of the year?
    Giordano net reduced its store count by 122, ending the quarter with 1,627 stores.

  • Giordano Sees Sales Surge Amid Economic Uncertainty: E-commerce Success And ‘beyond Boundaries’ Strategy Key

    Giordano Sees Sales Surge Amid Economic Uncertainty: E-commerce Success And ‘beyond Boundaries’ Strategy Key

    Hong Kong’s prominent fashion retailer, Giordano, recently announced an increase in their sales for the first half of the fiscal year. This significant improvement in sales is mainly attributed to a substantial surge in the company’s e-commerce operations.

    Positive Revenue Growth Amid Economic Uncertainty

    Giordano’s revenue for the first half of the fiscal year experienced an increase of 1.6 per cent, amounting to HK$1.934 billion (US$248 million). The management team highlighted this growth as a significant accomplishment in the midst of a fluctuating political and economic environment.

    The primary contributor to this growth was the company’s online business, which saw a remarkable increase of 26.1 per cent. This surge was credited to ongoing digital transformation efforts and customer-centric strategies.

    Geographical Revenue Analysis

    In the realm of geographical revenue, Mainland China saw a 13 per cent increase, with a nearly 18 per cent rise in the second quarter and an 8 per cent surge in the first quarter. Same-store sales remained steady in Q2, which was a positive shift from the 3.6 per cent decline in Q1.

    Revenue in Hong Kong and Macau reversed from a 6.5 per cent drop in Q1 to a 2.2 per cent increase in Q2, outperforming the overall negative retail sales in Hong Kong’s clothing sector.

    Sales in the Gulf Cooperation Council similarly experienced a 1.9 per cent growth during the half. However, Southeast Asia and Australia witnessed an 8 per cent decrease, mainly due to the poor performance in the Indonesian market.

    The company’s gross margin dropped by 3.3 percentage points to 55.6 per cent, which was primarily due to a larger volume of online sales and wholesale, inventory clearance efforts, and increased merchandise costs. The attributable net profit remained fairly consistent, with a minor increase of 0.8 per cent to HK$121 million.

    The ‘Beyond Boundaries’ Strategy

    CEO Colin Currie shed light on the company’s ‘Beyond Boundaries’ five-year strategy, which was initiated a year ago. He said that through this strategy, they were able to successfully execute a series of ‘Quick Win’ initiatives to establish a robust foundation for 2025 and beyond.

    The central focus of the ‘Beyond Boundaries’ strategy for 2025 is to strengthen the ‘Digital-First’ approach, simplify the brand portfolio, and make significant strides in Greater China.

    Currie stated that while the company is pleased with the positive results, they are continually reviewing and adjusting areas that need improvement, particularly in safeguarding their gross margin. To support better performance, they are actively improving their processes and enhancing sourcing efficiency.

    Last year, Giordano reported a 1.2 per cent revenue increase.

    Questions & Answers

    What led to the increase in Giordano’s sales for the first half of the fiscal year?
    The increase in sales was primarily driven by a significant boost in the company’s e-commerce operations.

    How did Giordano’s geographical revenue perform during this period?
    Mainland China experienced a 13 per cent revenue increase, while Hong Kong and Macau saw a 2.2 per cent rise. However, Southeast Asia and Australia faced an 8 per cent decrease in revenue.

    What is Giordano’s ‘Beyond Boundaries’ strategy?
    The ‘Beyond Boundaries’ strategy is a five-year plan aimed at strengthening the ‘Digital-First’ approach, simplifying the brand portfolio, and making significant strides in Greater China.

  • Chow Tai Fook arm in bid for Giordano International

    Chow Tai Fook arm in bid for Giordano International

    Giordano International Ltd. climbed as much as 23% after an investment vehicle owned by Hong Kong’s third-richest person offered to buy the apparel retailer.

    Clear Prosper Global Ltd., a BVI vehicle wholly-owned by Chow Tai Fook Nominee Ltd., offered to buy Giordano for HK$1.88 (24 cents) per share, according to a filing late Thursday. That’s an 18% premium on its most recent closing price, and shares surged to as much as HK$1.95 on Friday.

    The investment vehicle and its related parties already hold a 24.57% stake in Giordano and the maximum cash consideration is HK$2.56 billion, according to the statement.

    Chow Tai Fook Nominee is a private vehicle owned by the Cheng family, whose patriarch, Henry Cheng, is Hong Kong’s third-richest person with a fortune of $22.6 billion, according to the Bloomberg Billionaires Index. The family’s sprawling investment empire includes one of the world’s biggest jewelry chains, as well as real estate, infrastructure and hotels.

    Established in 1981, Giordano has around 2,100 shops in more than 30 countries and regions, according to its website. The acquisition offer will let the group continue its existing principal business, and there are no intended job cuts, according to the statement.

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  • Giordano opens store in Ghana

    Giordano opens store in Ghana

    Hong Kong-headquartered apparel brand Giordano has launched its first store in Ghana, adding to its African footprint, which already includes Kenya, Mauritius, South Africa, and Zambia.

    Partnering with local retail chain Melcom Plus, Giordano is planning to open more stores in the country this year at Achimota, Frafrah, Tema, and Weija – all inside in Melcom Department Stores.

    The first store includes wardrobe essentials and aims to “redefine simplicity” with maximised space for product displays.

    Mark Loynd, executive director and head of overseas market development in Giordano, said that the company is pleased to work with Melcom Plus, having a network of more than 50 wholesale and retail outlets.

    “We pride ourselves on being a ‘world brand’, and our overseas expansion initiative, which commenced several years ago, is now bearing fruit,” he added.

    Ramesh Sadhwani, joint group MD at Melcom, said there is a surge in demand for international fashion labels in Ghana, and they are looking forward to building a new retail landscape in West Africa by bringing in brands like Giordano.

    “With Giordano having over 2200 stores around the world, we are excited to carry the brand.” he said.

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  • Giordano sales rebound, delivering first-half profit despite fewer stores

    Giordano sales rebound, delivering first-half profit despite fewer stores

    Hong Kong-listed apparel retailer Giordano is back in the black after first-half sales rose 19 percent against the prior year – including 44 percent in the second quarter.

    Giordano, which now has 2094 stores across Southeast Asia, Greater China, and the Middle East, reported a post-tax profit of HKD60 million (US$7.71 million) for the half, in which its gross margin grew by 2.4 percentage points to 57 percent. The profit was a stark contrast to the Covid-impacted comparable period’s loss of HKD175 million ($22.5 million).

    And despite ongoing disruption to sales in various markets, the company pared back its inventory turn from 138 days to 124.

    The retailer closed a net 93 stores during the period, but its online sales soared 21.6 percent and now represent 10.1 percent of total group sales. Wholesale sales to franchises rose by 21.1 percent.

    While the company incurred a loss in Hong Kong and Macau – where mainland tourists were effectively barred for the entire period – increased sales to local consumers, the closure of unprofitable stores and rent reductions helped lessen the impact.

    “The average rental is still high despite gloomy consumer sentiment and the absence of incoming tourists,” said chairman and CEO Peter Lau in a results filing. “Management is continuing to negotiate with landlords for more affordable rental arrangements.”

    However, sales in Mainland China delivered a double-digit increase despite fewer stores.

    “Online sales and the franchising business continue to be our focus of development,” said Lau. “The online gross margin improved with increases in selling prices and fewer discounts.”

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  • Giordano opens largest retail store in Indonesia’s

    Giordano opens largest retail store in Indonesia’s

    Apparel retailer Giordano has unveiled a large-scale store in the newly opened Bumi Raya City Mall in Pontianak, Indonesia.

    Located on the mall’s first floor, the Giordano store spans 2300sqft and offers a complete range of men’s, women’s and children products.

    “This is our second store in Pontianak, which is one of the most culturally diverse cities in Indonesia and the entrance to Singkawang, the renowned ‘city of a thousand temples,” said Patrick Yeo, president director of Giordano Indonesia.

    Opened last month, Bumi Raya City Mall is home to more than 190 brands, including a host of international retailers and flagship stores. Bumi Raya City Mall is also the first family lifestyle mall to open in Pontianak.

    Founded in 1981, Giordano operates more than 2100 stores and counters in Greater China, South Korea, Southeast Asia, Australia, India and the Middle East.

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  • Giordano International warns for a profit decrease

    Giordano International warns for a profit decrease

    Giordano International (0709) warned that it expects to record an annual net loss of between HK$110 million and HK$130 million in 2020, as compared with a profit of HK$230 million in 2019.

    As stated in the interim results announcement last year, a net loss of HK$175 million was recorded for the six months ended June 30, 2020. However, the group expects to record a net profit of between HK$45 million and HK$65 million in the second half of the year due to the positive trend in retail sales and improvement in consumer sentiment.

    The forecast net profit has not taken into account further potential asset impairment charges.

    As of end-December, 2020, the group’s merchandise inventory was worth about HK$435 million, below that of 2019 by about HK$113 million.

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  • Hong Kong leads ‘drastic’ drop in sales for Giordano

    Hong Kong leads ‘drastic’ drop in sales for Giordano

    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.

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  • Giordano sales drop 34.6 per cent in March quarter

    Giordano sales drop 34.6 per cent in March quarter

    Fashion group Giordano says its March quarter sales fell by 34.6 percent as the outbreak of the coronavirus pandemic saw stores shuttered in key markets.

    Comparable same-store sales growth was a negative 30.2 percent.

    “Since the outbreak of the Covid-19 pandemic, many countries have implemented public health measures and ‘lockdowns’, often resulting in the halting of social and commercial activities,” the company said in a stock-exchange filing.

    “Moreover, the outcome of the Sino-US trade conflict remains unclear. All of these factors have adversely and significantly affected consumer sentiment and also foot traffic at our shops in various markets.”

    Year on year, Girodano’s global net store count has reduced by 128, most of the closures in Mainland China, where the network has shrunk from 623 to 572. In Hong Kong and Macau the retailer has shuttered a net seven stores.

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  • Giordano looking for global expansion

    Giordano looking for global expansion

    Giordano group sales fell 11.9 percent last year to HK$4.852 billion (US$624.6 million).

    Sales from physical stores fell by 9.6 percent, while sales to franchisees declined by 24.2 percent, partly due to the tightening of the company’s credit policy in light of weakening economic conditions.

    Excluding the impact of a change in accounting standards to allow a direct comparison of year-on-year results, Giordano would have recorded a profit for the year of HK$289 million ($37 million) for the year, down 39.8 percent. But the group’s gross margin slipped by just 0.3 percent to 58.7 percent.

    In a stock-exchange filing, the company said multiple factors including the Sino-US trade war, social unrest in Hong Kong, and an unseasonably warm winter impacted on sales by dampening consumer sentiment. The worst-hit markets were Hong Kong and Mainland China.

    One of Giordano’s biggest challenges was its e-commerce business on the mainland, where sales dropped 15 percent to HK$267 million ($34.4 million) due to “ferocious competition on established third-party platforms”.

    But e-commerce in other regions recorded strong growth. In Hong Kong “substantial growth” was achieved as the group launched on local third-party platforms such as HKTV Mall.

    “Management is determined to further develop our e-commerce business in all regions by improving the product mix and collaboration with emerging online platforms, the company said.

    In the year ahead, Giordano plans to expand its global footprint. Four franchised stores opened in Mauritius in the second half of last year and this year the company plans openings in India and Kenya. The Middle East and Indonesia businesses recorded sales growth last year, making them “critical markets” for short-term expansion.

    Meanwhile, the company expects the coronavirus outbreak to affect its business “significantly” in the first quarter of this year. “Nevertheless, with a secure brand positioning and quality merchandise, management is confident of overcoming the challenges ahead. Management will further strengthen the group’s financial position through a combination of strategies and actions.”

    The group plans a more cautious approach in Mainland China and Hong Kong this year and will instead focus on overseas markets, especially the Middle East and developing markets in Southeast Asia – Vietnam and Indonesia.

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  • Giordano issues profit warning to Stakeholders

    Giordano issues profit warning to Stakeholders

    Giordano International expects profit attributable to shareholders to fall by about 38 percent for the December year, based on a preliminary review of accounts.

    The fashion label issued a statement to the Hong Kong Stock Exchange warning shareholders ahead of a formal results announcement scheduled for March.

    Chairman and CEO Peter Lau said that while the decline in part followed the adoption of new Hong Kong Financial Reporting Standards 16 regarding leases, which took effect on January 1 last year and the impairment loss on right-of-use assets, it also reflected trading conditions.

    “The board is of the view that the decrease is largely confined to Greater China markets, and primarily attributable to, among other matters, the weak retail environment in those regions stemming from the Sino-US trade dispute, an unseasonably warm winter and social issues.”

    He said that despite the decrease which may be recorded in unaudited profit, the board considers the group’s overall business in non-Greater China markets remains healthy and the board remains positive on the long-term prospects of the group.

  • Giordano opens four stores in Mauritius

    Giordano opens four stores in Mauritius

    Hong Kong apparel brand Giordano has opened four locations in Mauritius. The stores are located in the Riche Terre Shopping Mall as well as the Rose Hill, Quatre Bornes and Curepipe areas.

    “We pride ourselves on being a ‘world brand’ – and our overseas expansion initiative, which commenced several years ago, is now bearing fruit,” said Giordano International executive director and head of overseas market development Mark Loynd. “We are extremely proud to be bringing our unique offering to the people of Mauritius.”

    Joining him in Mauritius for the stores’ opening was Giordano Middle East MD and stalwart of Giordano’s global expansion Ishwar Chugani, who added “Mauritius is a beautiful, inclusive nation which embodies our own brand ethos, ‘World Without Strangers’ – we are confident that Mauritius will welcome us and look forward to serving our customers here”.

    “Mauritius has become one of the fastest advancing countries in the region,” said Giordano’s overseas market development manager Hoying Lee. “We have a great working relationship with our local partners – as such, we do not rule out further expansion possibilities

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  • Giordano opens new-generation store in Dubai

    Giordano opens new-generation store in Dubai

    Hong Kong-listed apparel brand Giordano has revealed a new generation store design in its fully renovated store in Mirdif City Centre in Dubai.

    The 2000sqft store has a fresh new look embracing a more refined concept with the space maximized for product displays and customer interaction, including wider entrances and larger, more comfortable fitting rooms.

    Energy-efficient LED lights are used to enhance the customer experience while minimizing the store’s carbon footprint.

    “As we upgrade our stores’ design, we are confident of attracting more customers to come and shop at our shops,” said Giordano Middle East MD Ishwar Chugani.

    Following more than 25 years of brand growth, Giordano has opened eight new stores this year and plans to roll out the new design concept across the Middle East region. Giordano is also expanding to new markets with the opening of stores in South Africa, Mongolia, France and Mauritius.

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  • Giordano sales down across China

    Giordano sales down across China

    Giordano sales slid by 8.6 percent in the three months to September, or by 7.1 percent if measured by constant exchange rates. Comparable same-store sales fell by 10.3 percent.

    The damage to Giordano sales was largely borne in Hong Kong and Mainland China, where protests have hit inbound mainland tourist numbers since June and Chinese are spending less, spooked by the ongoing Sino-US trade war.

    Giordano sales in Hong Kong and Macau fell from $226 million to $169 million and in Mainland China from $251 million to $208 million.

    However, the China decline was mitigated in part by a strong performance in Giordano’s relatively new Middle Eastern markets. Sales there rose from HK$134 million to $153 million.

    Wholesale sales were constant.

    Despite the Hong Kong sales decline, Giordano maintained a network of 75 stores in Hong Kong during the period, the same number it had a year earlier.

    Group sales for the quarter totalled $1.075 billion, down from $1.176 billion a year earlier. Year-to-date sales (for nine months) were down from $4.036 billion to $3.617 billion.

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  • Trade war, climate erode first-half Giordano sales

    Trade war, climate erode first-half Giordano sales

    The China-US trade war and unseasonably warm winter have been blamed for Giordano sales falling 11 percent in the first half of the year.

    Profit for the Hong Kong-headquartered apparel retailer was impacted even more, dropping 36.6 percent to HK$161 million (US$20.5 million) on revenue of $2.542 billion ($324 million).

    By market, sales in Mainland China fell 22 percent, in Hong Kong and Macau by 11.9 percent and in Taiwan by 15.2 percent.

    Giordano sales in the rest of Asia-Pacific – its largest single market accounting for 31.8 percent of revenue – were down a lighter 3.7 percent, with performances by country mixed.

    Indonesia stood out with an overall same-store growth of 2.8 percent for both Giordano and non-Giordano brands, and with operating profit increasing by 6 percent. Thailand continued to achieve stable growth, with operating profit advancing by 9.1 percent, attributable mainly to sales growth and improvement of gross margin by 1.5 percentage points from 63.7% percent to 65.2 percent, the company reported.

    Sales in Singapore and Malaysia declined by 13 percent and 8.4 percent, respectively, due to weak consumer sentiment and slow economic growth.

    In Mainland China, promotional activities were intensified to curtail falling sales and clear slow-moving stock, resulting in a 1.4 percentage-point decrease in gross profit margin.

    Chairman and CEO Peter Lau said a series of marketing programs and smart promotional activities have been launched to “galvanise customer traffic”. On the mainland, Giordano is focusing on developing its franchise business, opening 24 new stores in the first half.

    The Middle East business stabilized and rebounded, with operating profit improving by 36 percent.

    South Korea (a 48.5-per-cent joint venture under an independent management team) reported a slight decrease in sales, while its gross profit was almost flat. Net profit declined due primarily to increased marketing and logistics expenses.

    In terms of the company’s outlook, Lau said the trade war is “taking its toll” on consumer sentiment.

    “In addition, Hong Kong’s weakening retail sector continues to be exacerbated by social unrest. The global economic environment is becoming more uncertain, with signs of economic slowdown in many different parts of the world.

    “Singapore is proving challenging, although management has already taken steps to shake up the local management team and remains confident that the business can be improved. Malaysia and Taiwan failed to meet expectations in the first half, although the local teams have stabilized their businesses and are showing signs of turnaround through effective cost control and improved product mix and localized campaigns.

    “Our Middle East business is showing positive signs of recovery while our Southeast Asian markets, in particular, Indonesia and Thailand, have performed positively and will continue its momentum into the second half of 2019.”

    Lau said the company’s initiative to develop local e-commerce businesses within its existing markets will also continue, in order to offer customers a more comprehensive shopping experience and serve a wider local customer base.

    “This will require resilience and determination in the face of growing competition in this online domain, but we have sowed the seeds and will continue to pursue the opportunities that lie in this realm.

    “That being said, cost pressures remain within the industry as a result of increasing production costs in a number of traditional manufacturing hubs in the region, as well as increasing costs of front-line shop staff in a number of the markets we operate,” concluded Lau.

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