Giordano sales pushed down by weak China demand
Clothing company sees improvement after mainland gross profit drops 5 per cent amid 'intense' price competition
Casual clothing chain Giordano International posted a 1 per cent increase in annual revenue to HK$5.67 billion last year despite sales on the mainland and Taiwan declining amid weaker demand.
On the mainland, the company's revenue dropped 6 per cent year on year to HK$1.9 billion and gross profit fell 5 per cent to HK$1.07 billion.
The company's chairman, Peter Lau Kwok-kuen, said: "In the first two months this year, our sales situation has improved [on the mainland]. Gross profit margin has increased during the period."
However, Lau said he expected generally weak demand would only improve slowly and intense price competition was likely to remain for some time until excess inventory levels in the marketplace were reduced.
He said looking ahead, the mainland remained the company's key market and Giordano would expand its operations there as market demand started to recover.
Lau said he expected 80 new outlets for Giordano's female clothes line to be opened on the mainland this year.
The company, whose design centre in Dongguan now develops products directly aimed at the Chinese market, said Giordano would look for growth opportunities in third and fourth-tier cities on the mainland.
