China's Embry Group posts revenue of HK$709.6 million in H1

Gross profit margin decreased by 1.46 percentage points to 74.45 per cent. Profit attributable to owners of the company more than tripled to HK$5,367,000 for the current period due to a low base effect during the same period last year. The increase in net profit was mainly attributable to the decrease in other expenses, in particular the reversal of impairment of right-of-use assets previously recognised by the group, and the recognition of tax credits by the group. Earnings per share were HK 1.27 cents.

“In the first half of the year, the release of pent-up demand triggered by the easing of the pandemic prevention and control measures in China led to a recovery in consumption. The brick-and-mortar retail businesses have gradually recovered, and consumption data in the catering, retail and tourism sectors have all indicated rebounds. However, the complicated global politics and economy, coupled with the not yet stable foundation for a sustained recovery in the domestic economy, have made China’s consumer sentiment cautious. While the sales of daily necessities recovered at a faster pace, the sub-essential underwear industry has not yet seen a full recovery in its business to the pre-pandemic levels,” Liza Cheng, chief executive officer and executive director of the group, said.

Looking ahead to the second half of 2023, the Chinese government will step up its efforts to stabilise the economy, aiming for steady national development. As a result, the retail market can expect moderate growth. However, consumers have become more prudent as they are facing the uncertainties of the global economy and politics and have experienced the COVID-19 pandemic. They are now more practical about making consumption decisions while aiming for better quality of life and sustainable consumption. They may even spend less. The retail and consumer industry has yet to see a full recovery to the pre-pandemic levels, and the underwear industry, in particular, is expected to recover more slowly than the overall retail market does, the company said in a press release.

“The group will closely monitor market trends to make timely adjustments in terms of product design, production technology, marketing and sales channels to fulfil the needs of consumers. In the future, the group will continue to review and adjust its business strategy, continue to explore different market segments, and at the same time, matching with the consumption pattern in the post-pandemic era, increase interactive promotion through social media, boost e-commerce sales, strive to expand the market share of its brands in the online retail market and optimise the effectiveness of the sales network. In terms of production capability, the group will respond promptly to market demands, leverage on the advantages of resource deployment through its self-production and self-distribution model as well as the ancillary logistics facilities of intelligent finished goods and materials warehouses to enhance production and logistics efficiency, and actively save energy, reduce emission and optimise the supply chain in order to achieve a sustainable development, striving to create long-term value for shareholders,” Cheng concluded.

Fibre2Fashion News Desk (RR)