Local cosmetics retail leader Sa Sa International has suffered an interim loss for the first time since the Asian financial turmoil in 1998 and has not received interim dividends for the first time since 2003
Sa Sa announced that due to social incidents in Hong Kong, the number of visitors to the Mainland of China decreased. As of the end of September this year, the interim results turned into losses, recording a loss of $35.3 million, compared with a profit of about two in the same period last year. 100 million yuan. The loss per share is one cents, and no dividend is paid. The group said that it will consider adopting more effective measures to reduce rents in the second half of the year, including reducing store size and closing stores to restore profitability as soon as possible.
Sasha said that given the extremely difficult operating environment in Hong Kong, the Group actively reduced rents and asked owners to reduce rents
Some street shop owners have agreed to short-term rent reductions. However, the current rental reduction will not help the Group’s performance. Therefore, the Group will continue to negotiate rents for the remaining stores in the second half of the year and consider adopting more effective rental reduction schemes, including reducing the store floor and closing the store. Resuming the profit contribution of the store as soon as possible is the primary goal. In addition, the Group also strictly controls the manpower of various departments through natural loss. The logistics staff of some ranks have also started to pay two to four days of unpaid leave every month since September, and encourage employees to clean up their holidays as much as possible to reduce the group’s Related provision expenses.
The Group’s turnover during the period was RMB 349.94 billion, a year-on-year decrease of 15.75%. Among them, retail sales in Hong Kong and Macau markets fell by 19.4% to 2,814 million yuan year-on-year. The decline in the first six months was mainly attributable to the decrease in sales in the Hong Kong market by 24.8%, but the Macau market was up by 3.6%. The sharp decline in sales and the drop in gross profit margins resulted in a loss of $3.3 million in the first half of the year.
Shrinking area, unpaid leave for employees
Sasha said that during the third quarter from October 1 to November 18, the Group’s turnover decreased by 31.6% year-on-year. Retail sales in Hong Kong and Macau fell 39.4%, while same-store sales fell 39.1%. In the first half of the year, the number of transactions from Mainland China’s visitors from Mainland China decreased by 25.3 per cent year-on-year, resulting in a decrease of 14.9% in the overall transaction volume and a slight decrease in the number of transactions by local customers. One point is seven. Since the sales from October to the present have still fallen sharply, and the protests in Hong Kong have not stopped, market participants are bearish on their annual performance.
The Group said that due to social events in Hong Kong, the number of visitors to the Mainland of China has decreased, and the market conditions in Hong Kong have further deteriorated since July. Retail sales and wholesale sales of the Group’s Hong Kong and Macau markets also deteriorated further, down by 24.2%, of which the retail sales in the second quarter of the Hong Kong market decreased by 35.4%. It has an increase of 11.3 percent.
Third quarter turnover fell 31%
The results of the report also showed that the number of transactions of the Group’s customers from the Mainland of China was seriously affected. The year-on-year decline in July and September this year was more than half, while the number of transactions by local customers decreased slightly by 3%. However, due to the large proportion of Mainland China’s passengers in Hong Kong’s market turnover, the Group’s overall retail sales performance in the second quarter of the Group fell by 35.4%.
Sasha also mentioned that the shops in the tourist areas were the first to bear the brilliance, including Tsim Sha Tsui, Causeway Bay and Mong Kok. The sales of the popular tourist areas recorded a decrease of about 50% to 60% from August to September. District shops must also be temporarily closed, but sales have fallen relatively little. On the contrary, the situation in the Macau market was relatively satisfactory. Sales in August and September recorded double-digit growth, mainly due to the increase in visitor arrivals from Mainland China and Hong Kong.