Trinity posts predicted loss
Menswear retailer Trinity says its first half year trading loss is a one-off.
The Hong Kong listed retailer and owner of high-end menswear brands in Greater China and Europe had already flagged a profit warning, relating to a one-time restructuring loss of HK$29.3 million which will result in a reduction of recurring staff costs.
It’s total half year loss was HK$47.4 million, which also reflected a prolonged period of no growth for high-end menswear in Mainland China, its principle market.
Trinity owns the Cerruti 1881, Kent & Curwen and Gieves & Hawkes brands.
Total revenue was HK$253.2 million lower than for the same period of last year, primarily as a result of the weak sales environment in Greater China. Same-store sales were down 15.9 per cent from the corresponding period in 2014 and the gross profit margin was 70.7 per cent.
Trinity says its cost cutting drive resulted in selling, marketing and distribution expenses for the first half reducing by HK$65.5 million year on year.
The value of the group’s inventory has been reduced to HK$510.1 million, down from HK$742.9 million in June 2014.
The number of stores fell from 433 a year ago to 386.
Trinity Limited’s CEO Richard Cohen, said the overall performance was in line with that experienced by the wider premium retail sector, noting that the management’s proactive steps had helped to mitigate the impact on Trinity of the very tough external conditions.
Trinity gave its three brands a significant branding refresh.
“The new brand stories and accompanying marketing campaigns will more solidly position each brand within its distinctive target market, while enabling us to appeal to rising consumer demand for authenticity and heritage,” he said.
“We are well positioned to take advantage of the evolving nature of consumer spending. Gieves & Hawkes with its prestigious No. 1 Savile Row address in London and the presence of Cerruti 1881 in Paris, enable us to appeal to the travelling Chinese consumers with brands they recognise, both at home and abroad.”
Cohen said sustainable returns in the medium- to long-term remain the group’s ultimate goal, as Trinity continues to adapt to meet the changing preferences and spending patterns of Chinese male consumers.