Esprit looks to China to offset sliding profits

Esprit Holdings (0330.HKG) plans to double its sales in China over the next four years in a bid to revive its business amid shrinking profits, Bloomberg reported. The clothier announced Thursday that profits fell to US$10.14 million in the year ended June 30 from US$542.94 million in the previous year. The news sparked an 18% drop in its share price, the biggest plunge in three years. The company is now in talks to sell its operations in the US and Canada, which reported a US$53 million loss in the year to June. “It’s a pity, but we have to be realistic – China is our future, not North America,” Van der Vis said in an interview in Hong Kong. Esprit’s sales in China more than tripled in its last fiscal year to US$340 million, comprising 7.9% of global sales. Esprit was founded in the US, but recorded 79% of its global sales in Europe.