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Gome to shut more shops to stem losses
Appliance retailer reports lower gross profit margin for the year, plans to get back on track with better product mix and in-store experience
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Gome Electrical Appliances, the second-largest home appliance retailer in the country, plans to close more stores to boost profit margins after reporting a narrower-than-estimated loss last year.
The Beijing-based retailer said in a filing yesterday that the net loss for the year to December was 597 million yuan (HK$746 million), compared to a net profit of 1.84 billion yuan in 2011.
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Meanwhile, sales revenue fell 20 per cent to 47.9 billion yuan.
The company warned of a loss in a statement to the Hong Kong stock exchange on January 28.
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Wang Junzhou, Gome's president, was quoted by Bloomberg as saying that the worst time for the company was over.
"This year we will see the results of changing our product mix and our cost-control measures coming further through," he said.
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