GERMANY: Escada Posts 72 Per Cent Profit Leap On Cost Cuts
German fashion house Escada AG on Monday reported a 72 per cent year-on-year leap in nine month profit on the back of continued cost cutting which helped offset falls in third quarter sales and earnings.
The company said in a statement earnings before tax and interest climbed to 19.5 million euros in the nine months to July compared to 11.4 million euros in the year-ago period.
Earnings were boosted by a 10.3 per cent cut in costs to 363.3 million euros as third quarter sales slumped to 161.1 million euros from 199.6 million euros in 2001. Group nine month sales slipped 5.6 per cent to 571.6 million euros.
Escada, which has been busy selling off non-core businesses, cited an "increasingly reserved consumer climate" for the sales slide and said it expects the luxury goods market to remain flat in the short term.
It added it will move into the black during the current fiscal year as it sees a profit of 20-30 million euros compared to a loss of 17.1 million euros in 2001.
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