Golden Eagle profit down 23.2pc

Mainland department store operator Golden Eagle Retail’s first-half net profit fell 23.2 per cent to 483.8 million yuan (HK$609.5 million).

Same store sales growth declined by 6.7 per cent, it said on Monday night. Turnover was 7.94 billion yuan, down 7.9 per cent from the same period last year.

The company, founded by billionaire Roger Wang, operates 26 department stores on the mainland, mainly in Jiangsu province and surrounding areas.

Department stores have been hard hit by the shift to online shopping. Fellow department store operator Intime reported a 2.4 per cent fall in same store sales growth in the first half while Parkson Retail reported an 8 per cent drop in same store sales in the first quarter.

Despite the faltering growth, Golden Eagle has been hesitant to develop an online platform. It has instead tried to improve sales performance through VIP loyalty programmes and mobile applications, launched WeChat accounts and invested in complementary lifestyle offerings such as cinemas and food and beverage options. Earlier this year it team up with Korean aquarium operator COEX to install an aquarium in a department store, the first on the mainland.

At 10.25am on Tuesday, shares of Golden Eagle were trading at HK$9.96, down 2.7 per cent, while the Hang Seng Index had dropped 0.1 per cent.