European debt crisis key to Esprit sales, outgoing chief says
Retailer says tough environment has resulted in exit from North American market and much of Europe amid management reshuffle
A deepening of the European debt crisis may hurt sales at clothing retailer Esprit, outgoing chief executive Ronald van der Vis warned yesterday.
Van der Vis resigned as the Hong Kong-listed retailer's chief executive and executive director yesterday, and will be replaced by former Inditex executive Jose Manuel Martinez Gutierrez.
"The situation in Europe is not improving and consumer confidence is highly impacted," said van der Vis. "If the crisis worsens in Europe, it will impact our business. If the crisis improves, our business will improve."
Martinez agreed the operational environment in Europe was quite tough, but added: "That doesn't mean we can't do well in Europe. We need to make sure we are one of those companies that do well in the current environment."
Europe accounted for 78.6 per cent of Esprit's turnover in the fiscal year to June. The company previously announced plans to close 80 loss-making stores, of which 65 are in Europe, 13 in Australia, one in Singapore and one in Hong Kong. Of those stores, 64 have already closed, said chief financial officer Thomas Tang Wing-yung. It had closed all 97 stores in North America and its New York headquarters, and laid off 1,600 North American employees, he said.