HONG KONG, Sept 26 (Reuters) - Europe-focused retailer Esprit Holdings Ltd posted an 11-fold rise in full-year net profit on Wednesday, boosted by an exceptional gain related to the closure of its North American operations, but missed analysts’ forecasts.
Esprit, which competes with Swedish clothing retailer Hennes & Mauritz AB and Zara owner Inditex of Spain, reported a net profit of HK$873 million for its fiscal year ended in June, compared with an average estimate of HK$1.01 billion in a poll of 10 analysts by Thomson Reuters.
The result was higher than the HK$79 million profit posted a year earlier when the company took a one-time charge of HK$2.3 billion to set aside provisions for the closure of stores. The overall closure costs were less than expected and the company was able to write back some of those provisions in the latest term.
Esprit, which sells everything from bed sheets to jeans and generates about 80 percent of its sales in Europe, has been trying to restructure its business as it grapples with a slump in demand due to the euro zone debt crisis.
Shares of Esprit have gained 29 percent so far in 2012, outpacing an 11 percent rise in Hong Kong’s benchmark Hang Seng Index. The stock was down 2.7 percent by the lunch break on Wednesday, lagging 0.9 percent fall in the benchmark index. (Reporting by Donny Kwok; Editing by Chris Gallagher)