Hong Kong based fast fashion brand Esprit says first quarter group turnover was flat year on year.

A 7.6 per cent reduction in selling space led to a modest 0.4 per cent decline in sales expressed in local currency.  

Total retail turnover grew year on year by 9.1 per cent in local currency, reversing a decline of 10.1 per cent in the full 2015 year.

“We are especially encouraged by the noticeable gain in sales per square meter performance of our retail space, which reflects significantly improved product performance, as well as improved marketing and channel operations,” the company said in a stock exchange filing.

“Our retail operations are off to a good start as the positive momentum of top line improvement observed in the latter part of the last financial year has continued into 1Q of 2016. Our well received Autumn/Winter collections, together with our #ImPerfect brand marketing campaign and Omnichannel initiatives, are the key drivers behind the increase in retail sales, both online and offline,” the company said.

Asia Pacific sales fell 3.6 per cent year on year in local currency, which also compares favorably against a corresponding 14.5 per cent reduction in total controlled space.

“The relatively weaker performance in Asia Pacific was mainly due to China, where we observe dampened consumer sentiment affecting our sales performance,” the company said.

Hong Kong-listed Esprit says most of the sales improvement was due to strong performance in Europe, particularly of its womenswear lines. In local currency, sales in Germany, its single largest market, rose 10.7 per cent and in the rest of Europe by 13.6 per cent.

Wholesale sales declined 12.3 due to increased competition and a shrinking of the reseller network.

Esprit says it is encouraged by the first quarter of the year and believes the figures demonstrate its reformation program is beginning to pay off.

“Overall, the continuation of the positive trend in our retail sales performance since the introduction of the Vertical Products in February 2015 keeps reinforcing our confidence that we are on the right track to restoring the attractiveness of our products and the upside potential of the Esprit brand.”