Esprit experienced a 4.8% decrease in group revenue during the first half (H1) of the 2023 fiscal year, leading to a revenue figure of 464 million euros (approximately $488 million) for the period between March and August.
The decline in revenue was primarily attributed to a challenging retail environment, characterized by geopolitical uncertainties, inflationary pressures, and a shift in consumer sentiment. Notably, the Asia-Pacific region, which accounts for a significant portion of Esprit’s business, was particularly affected by the prevailing economic headwinds. Furthermore, the company’s decision to reduce its store footprint in Europe also contributed to the overall revenue decline.
Despite the revenue shortfall, Esprit’s H1 results were largely in line with management’s expectations. Gross profit margin remained stable at 56.7%, reflecting the company’s ongoing focus on optimizing its product portfolio and improving its sourcing strategies. Selling and distribution expenses were reduced by 4.7% year-over-year, primarily due to lower store operating costs and more efficient logistics.
As a result, Esprit’s H1 earnings before interest and taxes (EBIT) amounted to 14.8 million euros (approximately $15.6 million), representing a marginal decrease compared to the prior year. The company’s net profit for the period stood at 8.4 million euros (approximately $8.9 million), slightly below the previous year’s figure.
Commenting on the H1 results, Esprit’s CEO, Anders Kristiansen, acknowledged the challenges faced by the company but expressed confidence in the business’s long-term prospects. He highlighted the company’s strategic initiatives, including the expansion of its digital channels, the implementation of a new global sourcing strategy, and the strengthening of its product assortment.
Kristiansen stated, .
