Si Jie Global Annual Performance Surplus Profit Loss, Net Loss Amounted To HK $2 Billion 554 Million

In September 18th, Si Jie global announcement, as of June 30, 2018 (17/18 fiscal year or review period), the company realized HK $15 billion 455 million, down 3.05% compared with the same period last year. The loss of shareholders of the company was HK $2 billion 554 million, a profit of HK $67 million in the same period last year. The loss per share was HK $1.35, not paying dividends.

In the financial year 17/18, the Group recorded a gross profit of HK $7 billion 921 million.

51.3%, roughly the same as last year.

A slight decrease of -0.3 percentage points in local currency was mainly due to a decrease in the proportion of retail revenue (excluding electronic stores), which accounted for 40.4% of the group's revenue this year, accounting for 42.1% last year.

During the review period, the Group recorded an income of HK $15 billion 455 million, which was HK $15 billion 942 million in 2017, a year-on-year decrease of 3.05%.

The reduction of income is due to the following comprehensive effects: strategically

In order to improve profitability and reduce passenger traffic, retail sales are worse than expected.

Closing the distribution area of non profitable retail outlets and low performance wholesale area to reduce the total controllable area (retail and wholesale total) by 55288 square meters in 17/18 fiscal year, an annual decrease of -9.3%.

Retail (excluding electronic stores), the group closed 21289 square meters in the 17/18 fiscal year, an annual decrease of -7.8%.

During the review period, the group's retail sales performance was lower than expected, compared to retail stores (excluding electronic stores), the annual decrease of -9.6% in local currency and the decrease of -6.1% in the local currency.

Women's clothing accounted for 66.1% of the group's income.

Group respectively

The two brands sell their products. The products are mainly divided into three categories: Women's wear (Esprit and EDC) account for 66.1% of the group's income.

(Esprit and EDC) accounted for 16.3% of group income and 17.6% of life and other group income.

(1) women's wear (Esprit and EDC)

Women's wear (Esprit and EDC) accounted for 17 / 18 66.1% of the group's revenue in the financial year, and the annual decrease of -9.7% in local currency was not satisfactory.

The priority now is to improve products to enhance the attractiveness of target customers.

In this regard, the most important achievement of the annual product is the establishment of two independent product lines, namely, the main product line and the fast selling product line.

(2) men's wear (Esprit and EDC)

Men's clothing (Esprit and EDC) accounted for 16.3% of the group's revenue in the financial year 17/18, and it decreased by -15.0% per year in local currency terms.

As the performance of men's wear continued to be weak, the group reduced the area distribution of men's clothing products in retail stores (by an annual reduction of -9.9%), thus exacerbating the decrease in income.

(3) lifestyle and others

Life style and other 17.6% of the group's income is -12.2% per year in local currency terms.

This product category mainly includes underwear, accessories, footwear, and the sale and approval of the right to manage the products, such as children's wear, watches, glasses, jewelry, bed and bath products and family products.

Excluding the children's clothing division (KidilizGroup, formerly known as GroupeZannier), which has been granted to the -75.2% (reduced by -75.2% per year in local currency), the income from lifestyle and other sectors is reduced by -8.7% per year in local currency.

Retail sales in the Asia Pacific region account for 10.1% of the group's total revenue.

In the fiscal year 17/18, retail revenue (excluding electronic stores) decreased by -13.8% in local currency terms.

In terms of distribution channels, retail (excluding electronic stores), wholesale (excluding electronic stores) and electronic stores account for 82.3%, 6% and 11.7% of the region's revenues respectively.

Retail sales in the Asia Pacific region (excluding electronic stores) account for 10.1% of the group's total revenue and -17.1% per year in local currency terms.

The change in revenue was mainly due to a year-on-year decrease of -14.8% in net sales area, which was in line with the group's plan to accelerate the restructuring of the shop network in the region, especially in China, Taiwan, Australia and New Zealand and Hongkong. The net sales area of these areas decreased by -14.5%, -24.4%, -29.3% and -23.9% respectively.

The net sales area of Australia and New Zealand has been reduced by -29.3%, reflecting the impact of the group's withdrawal from the region, while the net sales area in Hongkong has decreased by -23.9%, reflecting the impact of closing the Tsim Sha Tsui flagship store.

By the year of June 30, 2018, there were 145 direct management stores in China, with a net sales of 27345 square meters of net sales, with a net opening of 33 houses.

There are 9 stores directly managed by Hongkong, 5 in Macao, and 1 stores in the net during the reporting period.

In addition to closing stores, the Asia Pacific region's revenue reduction has also reduced the discount level of the region in order to maintain brand strength as a result of the group's implementation of measures to improve profitability. Compared with the sales performance in the department stores of Chinese department stores, the sales volume of stores can be reduced by -11.1% in local currency year by year.

Electronic store channel revenue HK $4 billion 169 million

The electronic store includes direct management e-commerce business in Europe and Asia Pacific countries and sales to the third party online platform in the Asia Pacific region, accounting for 27% of the total revenue of the group and 16 / 17 for the fiscal year 25.3%.

During the review period, the channel generated revenue of HK $4 billion 169 million, an annual decrease of -6.1% in local currency terms.

Electronic stores in the Asia Pacific region account for 5.3% of the total revenue of the group electronics store in the fiscal year 17/18, and decrease by -5.3% in local currency.

The decrease in revenue is due to the decisive measures taken by the management to increase gross margin through reducing sales promotions and discounts to focus on a more profitable mode.

Revenue in 18 / 19 is expected to decrease by a low double-digit percentage.

18 / 19 revenue is expected to decrease by a low double-digit percentage in a year, mainly due to the following two factors: continuing to rectify the distribution area will reduce the total controllable area by a percentage of the number of units in the middle and high units; and after implementing the measures to stimulate passenger traffic, the volume of traffic may still decrease slightly from the previous year.

In support of the driving force of growth, the group must strengthen its brand image, create an exciting and comprehensive shopping experience for customers, and launch a series of products that are fashionable and conform to regional trends, so as to improve the production efficiency of sales per square metre.

Profitable wholesale business will play a central role in the new direction of group development.

At the same time, the group continued to optimize the e-commerce platform by strengthening its partnership with the third party wholesale e-commerce.