Hong Kong apparel retailer Giordano International Ltd on Tuesday reported a net profit of HK$60 million (US$7.71 million) in the first half of the year, reversing a HK$175 million loss from the same period a year earlier.
Giordano said it will try to continue to mitigate the influence of the COVID-19 pandemic and boost earnings by paying less rent and reducing discounts.
Currently, the most important thing is to remain flexible to adapt to the uncertainty of the pandemic.
Mark Loynd, Giordano Executive Director
According to the interim results, despite a reduction of 4.3 percent in the total number of stores, sales rebounded and increased 19 percent year-on-year to HK$1.68 billion in the first six months due to improved business performance and a low comparison base of the same period last year.
The retailer’s online business continued to expand in the first half, increasing 21.6 percent year-on-year and accounting for 10.1 percent of the company’s total sales. The company said emerging markets and the expansion of its online business presents opportunities for future growth.
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“Currently, the most important thing is to remain flexible to adapt to the uncertainty of the pandemic,” Giordano Executive Director Mark Loynd said. “Also, we began to expand the markets in Central Asia, which has large potential of development in the long term.”
In the Hong Kong and Macao markets, Giordano recorded an operating loss, but less than that of the same period in the previous year. The improvement was mainly attributed to sales increases and rent reductions that were partly from the closure of money-losing shops.
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Gary Chan, another Giordano executive director, expressed optimism about the business in Hong Kong and Macao in the second half of 2021. “Sales are likely to continue to improve unless there are unexpected outbreaks of the COVID-19 pandemic,” he said.
Chan added that business in Hong Kong improved after the city’s consumption voucher program was launched, but more time is needed to see whether the program will boost the company’s business in Hong Kong in the longer term.
The company said it is difficult to predict its sales and profitability for the second half of the year, as the COVID-19 situation remains volatile and might affect its performance because of sudden curfews, lockdowns, and movement controls.
Giordano’s shares closed at HK$1.61, up around 3.87 percent, on the Hong Kong stock market on Tuesday.