Belle same store sales hurt by growth in China e-commerce
Footwear retailer Belle International expects same store sales to shrink this year as traffic at mainland department stores, a major sales channel, slows as a result of e-commerce.
Footwear retailer Belle International expects same store sales to shrink this year as traffic at mainland department stores, a major sales channel, slows as a result of e-commerce.
"Earlier this year we thought we could maintain the level of growth but looking at this point in time, it will be negative," chief executive Sheng Baijiao said yesterday.
Sheng said sales in the months with key holiday periods such as January, February, September and October were not as strong as expected.
Belle owns mid-market shoe brands such as Staccato, Millie's, Joy & Peace, and distributes top sportswear brands Nike and Adidas on the mainland.
Interim profit for the six months ended August increased 7.6 per cent to two billion yuan (HK$2.5 billion). The company proposed an interim dividend of 15 fen per share and a special dividend of 25 fen per share resulting in a payout ratio of more than 160 per cent.
Revenue increased by 10.9 per cent from a year ago to 18.6 billion yuan. The firm held 1.7 billion yuan in cash and equivalents at the end of August.
"We are past a phase of rapid growth and we hope that by giving a special dividend, we can offer a better return to our investors," Sheng said.
Shares of Belle rose 10.26 per cent yesterday to HK$9.35.
The company still has no concrete online sales strategy. The management said it has yet to find ways to accommodate mainland consumers' expectations of cheaper online products.
Rival footwear firm Le Saunda, which has a more proactive online strategy, reported profit jumped 26.7 per cent in the first half to HK$10.3 million as revenue increased 7.7 per cent to HK$941.1 million.
Its performance was boosted by the closure of all stores of its mid-market CNE brand and the decision to move to a purely digital platform to cut costs.
Le Saunda closed at HK$3.87 yesterday, up 6.03 per cent.
