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Tag: IT limited

  • I.T flags big loss as Covid-19 impacts shoppers’ enthusiasm

    I.T flags big loss as Covid-19 impacts shoppers’ enthusiasm

    Multibrand Hong Kong fashion retailer I.T Limited has warned shareholders it will likely post a loss of at least US$38.7 million for the six months to August, such has been the impact of the Covid-19 on sales.

    Chairman Sham Kar Wai said in a letter to shareholders that the Covid-19 pandemic had led to a decline in consumer-spending enthusiasm across the world. While it has offered extra discounts to boost sales volume amid “an incredibly difficult trading environment” sales were down substantially.

    This is the third profit warning the company has issued this calendar year, following earlier announcements in July and August. It is based on initial figures and subjects to change before final results are reported tomorrow, (October 29).

    “Although during the period ended 31 August, the group took rapid and decisive action to reduce costs considerably, the savings in operating costs were not sufficient to offset the decline in sales and gross margin,” he said.

    August’s likely half-year loss follows a deficit of $9.2 million in the same period last year.

    I.T Group operates its own brands, including Chocolate and 5cm, concept stores Izzue and Double-Park; international brands it has local licenses for including Kurt Geiger and Camper; and A Bathing Ape, which the company rescued from Japanese owners in 2011.

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  • I.T Limited sales, margins eroded due to Covid-19 lockdowns

    I.T Limited sales, margins eroded due to Covid-19 lockdowns

    Hong Kong-headquartered fashion retailer I.T Limited says its sales have fallen in all of its markets, with the US and Japan the worst affected. Same-store sales of its Hong Kong and Macau stores fell by 49.1 percent in the three months to May 31, while US and Japan store sales plunged 66.1 percent. In Mainland China, the sales decline was a less dramatic 11.8 percent.

    I.T Group operates its own brands, including Chocolate and 5cm, concept stores Izzue and Double-Park; international brands it has local licenses for including Kurt Geiger and Camper; and A Bathing Ape, which the company rescued from Japanese owners in 2011.

    Chairman Sham Kar Wai has warned that the company will post a loss for the first quarter compared to a profit for the same period last year.

    “It remains difficult for the group to precisely predict and quantify the negative impact that will result from the Covid-19 pandemic and social unrest around the world, but we expect our business will continue to face strong headwinds for the remainder of the year,” he said in a stock-exchange filing.

    Stores were closed or forced to trade for reduced hours, in most markets due to the Covid-19 crisis.

    “Although our initial strategy was to focus on full-price sales and reduce discount related activities in order to secure gross margin, we eventually had to increase mark-downs to boost sales volume amidst an incredibly difficult trading environment,” he said.

    Gross profit margin fell by 8.8 percent globally, with a 9.5-per-cent decline in Hong Kong and Macau resulting in a final margin of 49.9 percent. Despite the size of the sales decline in Japan and the US, gross margin remained higher than in any other market at 64.5 percent, down 7.8 percent in the quarter. In Mainland China it fell 8.7 percent to 55.3 percent.
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