Esprit shares slide as profits miss estimates

 
Kasmira Jefford
Follow Kasmira
STRUGGLING fashion retailer Esprit saw shares tumble seven per cent on the Hong Kong stock exchange yesterday after it reported full-year profits that missed expectations.

Esprit is trying to restructure its business, last year launching a four-year HK$18bn (£1.4bn) turnaround plan and hiring supermodel Gisele Bundschen to front its global campaign.

The group yesterday said the transformation plan remained on track but warned Europe’s unresolved debt crisis and the economic slowdown in China made next year’s performance uncertain.

Revenue for the year to 30 June dropped 11 per cent to HK$30.17bn, due to its exit from the US, store closures in Europe and Asia and tough economic conditions.

Esprit reported a net profit of HK$873m, up from HK$79m a year earlier, but missing consensus forecasts of HK$1.01bn.

In June, the group was hit by the unexpected departure of its chief executive Ronald van der Vis, followed by the chairman Hans-Joachim Körber.

Esprit is pinning its hopes on new chief Jose Manuel Martínez Gutiérrez, a former executive at Zara owner Inditex who took over the helm yesterday, to drive the restructuring plan and revive sales.