CHINA: Belle International warns of tough times ahead
- Net profit for 14 months to 28 February up 1% to RMB5.159bn
- Revenues up 10.1% to RMB43.067bn
- Warns of “weak consumer sentiment” for next two years
Apparel and footwear business Belle International Holdings is warning of a tough two years for the Chinese market, despite a double-digit revenue rise in the 14 months to February.
The company, which has shifted its year-end from 31 December, said footwear revenues were up 5%, while sportswear and apparel rose 19.1%.
The increases, it said, were caused mainly by the consolidation of newly acquired businesses and same store sales growth, but warned that broader macro-economic factors were continuing to impact business.
“With the [Chinese] economy continuing its structural rebalancing and slower growth becoming the new normal, consumer confidence has been low and consumer sentiment weak,” said Belle International, which distributes Nike and Adidas in China.
“The macro-economic outlook for the next two years is not optimistic. The consumer retail market is expected to be under continued pressure due to weak consumer sentiment.”
Sales had also been affected by an unusually warm winter and cold spring, the company said, highlighting rising costs, especially staff-related expenses.
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