Baleno'S Parent Enterprises Closed 316 Stores In The Mainland Last Year, Still Making A Profit Of HK $325 Million 200 Thousand In The First Quarter.

The famous casual wear Brand Company Baleno Baleno's parent company, German wing Kat, can still uphold the old style of traditional manufacturing and retail companies in Hongkong, and repay shareholders with high dividend payouts in peacetime.

As of the end of March, in the 2019 fiscal year, the German dollar recorded a net profit of HK $325 million 200 thousand, representing an increase of 6.9% over the HK $304 million 300 thousand in the 2018 fiscal year. The earnings per share increased from 22 Hong Kong cents to 23.5 Hong Kong cents. The company intends to pay interest at the end of 15 cents in Hong Kong, which is flat compared to 2018. The annual dividend payment of 30 Hong Kong cents is HK $414 million 500 thousand, although it is less profitable than that in the 2018 fiscal year, but it is much more profitable than the whole year.

Due to the sluggish retail business, the German company declined 3.8% to HK $8 billion 210 million 100 thousand for the whole year, and HK $8 billion 530 million 800 thousand in the 2018 fiscal year. During the period, the revenue of group retail business fell by 13.6%, from HK $3 billion 989 million to HK $3 billion 448 million, accounting for a sharp decrease of 480 basis points to 42%.

The Hongkong company said last year that consumer confidence was damaged by tension in Sino US trade relations, especially in the mainland, where consumer sentiment was weak. Besides, warm winter weather also had a negative impact on clothing sales.

Retail sales, including Baleno, S&K, I.P. Zone and Ebase, fell by 12.8% last year, a sharp decline from the 6.9% decline in 2018. EBITDA recorded a loss of HK $24 million, operating losses of HK $110 million, while EBITDA in 2018 fiscal year and operating profits were HK $102 million and HK $14 million respectively.

Mainland China's retail business plunged 18.4% to HK $2 billion 786 million last year, HK $3 billion 414 million in the 2018 fiscal year, 316 or 12.6% sales points, 764 or 15.4% to 4182 sales personnel, and Hongkong's retail business income rose by 15.1%, from HK $575 million to HK $, but the smaller share failed to offset the decline in the mainland market. Sales growth was mainly due to the net increase between the stores and between the outlets.

Despite the decline in retail sales, the gross profit margin rose 270 basis points to 50.1% last year, while the total gross margin of Germany's Yongjia market rose to 100 basis points to 31.7%.

The downturn in retail business was offset by the growth of the textile business at the core of de Yongjia. In the 2019 fiscal year, the income of textile business increased by 4.9% to HK $4 billion 759 million over the same period of 58%. Although the price of pigment and chemical raw materials rose, EBITDA remained 28.3%, from HK $4.10 to HK $526 million, and gross margins rose by 240 basis points to 18.3%.

Looking forward to the future, Tokunaga Ka said that the textile business will face another challenge year. The group will continue to control the operation cost and improve production efficiency. With a strong development team, more innovative and value-added products will be introduced to enhance business performance; retail business will strictly control costs to reduce operating expenses, while strengthening the development of children's products to expand customer groups, while expanding overseas franchise business will become the core focus of the group. It is believed that under a sound foundation and financial health, the group is capable of facing potential difficulties and challenges.

Germany's most famous Baleno brand business last year revenue of HK $3 billion 73 million, down 6.1% compared to the same period, group retail business is now mainly focusing on the brand, while other brands are closing or weakening. Last year, German wing Jia also spent HK $28 million, increasing its equity stake from 64% to 82%.

After the release of the afternoon market, the Texwinca Holdings Ltd. (0321.HK) de Yongjia opened its highest value in the afternoon, and pulled up 6.36% to a full day high of HK $2.51, but the closing price narrowed to 0.42%. The closing price of HK $2.37 corresponds to the market value of HK $3 billion 275 million. Author: Hua Fei