Hong Kong-based fashion retailer I.T expects its mainland venture to break even this year after reporting that net profit was almost unchanged in the past fiscal year. The company posted a flat net profit of HK$122.4 million for the year ended February, despite a 16.5 per cent jump in sales to HK$1.53 billion. The result was below an average estimate of HK$133.5 million from a Thomson Financial poll of four brokers. The company said earnings had been weighed down by a six million yuan loss at GSIT, its mainland equal-share joint venture with Hong Kong-based retailer Glorious Sun. I.T also wrote off a HK$4.4 million expense for not buying a Shanghai mall it had intended to purchase to tap the mainland luxury consumer market. The retailer said underlying profit rose to HK$130.6 million on a 7.7 per cent increase in same-store sales in Hong Kong, while its gross margin fell 0.7 percentage points to 58.2 per cent. The company operates 156 retail outlets in Hong Kong. Vice-chairman and managing director William Lo Wing-yan said GSIT, which has 165 outlets, is expected to break even this year as the venture contributed profit in the second half of last year. He said GSIT would open two stand-alone retail stores for the Chloe brand, one in Beijing and the other Shanghai, between July and August, and one individual outlet for UK designer Stella McCartney this year. Mr Lo said I.T's sales in Hong Kong rose 13 per cent between March and April, while same-store sales grew 8 per cent. GSIT's sales, which totaled 330 million yuan last year, rose 73 per cent during these two months, while same-store sales increased 27 per cent. Shares of I.T, which have climbed 10.9 per cent over the past 12 months, retreated by 1.5 per cent yesterday to close at HK$1.32 ahead of the release of the company's earnings announcement.