Trinity performs satisfactorily under adverse conditions

27 Aug '12

5 min read

Trinity Limited announces the interim results for the six months ended 30 June 2012. The performance of the Group’s retail stores is subject to seasonal fluctuations and certain holiday seasons. Management has determined the operating segments based on reports reviewed by the senior executive management of the Group that are used to make strategic decisions. Management considers the business from both geographic and business lines perspectives.

During the period under review, the Group performed satisfactorily under adverse conditions. The Group posted results that were relatively in line with its expectations given the challenges in the market, and it made significant progress in continuing to lay the foundation for future growth – both for the Group and for its portfolio of brands.

Difficult conditions are likely to remain for the second half of the year. While there are positive indications in the medium to long term for the Chinese Mainland luxury sector, softening same-store sales, rising staff costs and increased inventory led to more modest results for the first half of 2012.

The Chinese Mainland economy has shown resilience in the face of the global downturn despite a slower pace of growth. Its luxury sector, including menswear, is not always immune to economic challenges, but its long-term potential is strong given that disposable income – and hence spending power – will continue to rise. In the short term, we will remain vigilant on costs while continuing to invest in order to build a solid foundation for future growth when opportunities arising from a global economic turnaround present themselves. The Group is confident that it has the correct long-term business strategy and prospects to succeed.

Revenue increased in the first half of 2012 by 13.4%, driven by moderated same-store sales growth and continued store expansion in Greater China as well as licensing income and retail revenue from Europe. Same-store sales for Hong Kong & Macau and the Chinese Mainland increased by 13.6% and 5.9% respectively. But Taiwan recorded a negative growth of 12.7%. Revenue from the Chinese Mainland contributed 59.8% of the Group’s total revenue from Greater China.

Revenue from Greater China grew by 8.4%, compared to the same period in 2011. After acquiring 100% interests in Gieves & Hawkes Group in May 2012, the Group now owns three global brands, Cerruti, Kent & Curwen and Gieves & Hawkes, which accounted for approximately 91.0% of the Group’s revenue.