Chinese footwear seller Belle says profit squeezed by competition
HONG KONG Feb 23 (Reuters) - China's top footwear retailer Belle International Holdings Ltd reported a 3.2 percent rise in 12-month profit as competition from e-commerce and an increasing supply of shopping malls dampened sales in a tough retail climate.
"Traditional retail channels, including the street shops and department stores, are under continued pressure due to weak foot traffic," CEO Sheng Baijiao said in a statement on Sunday.
"In the near future various businesses of the group will still be facing enormous challenges," Sheng added.
Belle, which distributes footwear and sportswear brands including Nike, Adidas, PUMA and Converse, posted a net profit of 4.491 billion yuan for 12 months ended in December, up from 4.352 billion yuan a year ago.
That compared to an average forecast of 4.362 billion yuan for January to December period, according to analysts polled by Reuters. Revenue rose 10.3 percent to 36.249 billion yuan.
Belle has changed its financial year-end date to end of February. It will announce its earnings for 14 months ending in February in May.
Gross profit margin of its overall business increased to 57.5 percent during the 12 months period, from 56.6 percent a year ago. Cost of sales surged 7.9 percent.
Belle directly managed a network of 19,077 stores in mainland China as end of 2013, an increase of 9 percent from a year ago. It said it would maintain a similar pace of network expansion in the next two to three years.
For full statement click (link.reuters.com/wux96v)
Shares of Belle, which fell 46.7 percent last year, have lost 1.9 percent so far this year, outpacing a 3.2 percent drop in the benchmark Hang Seng Index. ($1 = 6.0914 Chinese yuan) (Reporting by Donny Kwok; Editing by Louise Heavens)
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