I.T Group sales surge in Mainland China, US and Japan
I.T Group sales slipped in the company’s home market, but the fashion retailer is achieving high growth in Mainland China, the US and Japan.
Unaudited sales data for the three months to November show an 8.5 per cent year-on-year improvement in Japan and the US and 6.8 per cent growth on the mainland. Hong Kong and Macau sales slipped by 1.8 per cent in the same period.
Figures for the nine months to November are even better in the US and Japan, up 11.1 per cent, while sales growth in the home market reached 4.8 per cent and on the mainland 1 per cent.
I.T Group operates its own brands, including Chocoolate and 5cm, concept stores Izzue and Double-Park; international brands it has local licences for including Kurt Geiger and Camper; and A Bathing Ape, which the company rescued from Japanese owners in 2011.
Chairman Sham Kar Wai said “complex macroeconomic conditions” affected the business in all three regions during the third quarter.
“Our Hong Kong and Macau operations registered negative same-store sales growth as a result of multiple typhoons, and weaker consumption appetite during the period. In contrast, our Mainland China business delivered positive same-store sales growth, and our Japan and the US regions continued to progress on a positive trend.”
He said the group continued to execute measures to safeguard its gross margin, including holding back discounting.
“However, enhancements to gross margin was overshadowed by the negative impact of the depreciation of currencies of our merchandise purchase. As a result, gross margin decreased during the period.”
Sham Kar Wai said the company has been even more cautious about the overall operating environment over the last few months, as the recent escalation of trade dispute between Mainland China and the US has cast “greater uncertainties on the future economic outlook”. “Moreover, the warm weather in Hong Kong and Macau may further weigh negatively on the consumer spending momentum across the region.”