Luxury bag and accessories retailer Milan Station Holdings says it is narrowing its losses.
In a filing with the stock exchange on Monday, the company said it expected to record “a significant decrease in net loss” for the six months to June 30.
Chairman Kwan Tat Yiu said the improvement was the result of three factors: a one off gain on the disposal of a property of $12 million, higher margins by directly importing inventory from Europe and a “reduction in the selling expenses through effective cost control measures and optimisation of the store portfolio of the group.”
In May, Milan Station terminated the agreement with its Singapore franchisee M C Holdings and negotiated the end of consignment sales at concession counters at Hong Kong’s four cruises piers.
The Singapore franchise agreement dates back to June 2013. The two parties have agreed that half of the security deposit of S$180,000 shall be deducted by the franchisor as compensation for inconvenience incurred, with the balance to be repaid. Unsold stock will be returned to Milan Station.
The Hong Kong company says the concession business under the Concession Agreements accounted for approximately 1.8 per cent of the group’s revenue in the year to December 31.
The Singapore franchise business accounted for approximately two per cent of group revenue.