While Hong Kong clothing retailer Giordano International says market conditions in Southeast Asia have been challenging during the past two years, it increased its profitability in Singapore last year thanks to improved merchandising.

But Southeast Asia will be a tough market going forward, the company says in a statement announcing its results for the past financial year.
Consolidated sales eased by 3 per cent for the year, but increased by 1 per cent on a constant currency basis. Global brand sales were down 1 per cent for the year, but comparable same-store sales grew by 3 per cent.
Gross profit margin declined by 0.4 percentage points to 57.6 per cent, with higher purchasing costs caused by a strong US dollar eroding margins in Southeast Asia and Taiwan.
“Weak consumer demand in many markets has led to fierce competitive pressure on selling
prices,” says the group.

Nevertheless, in the second half of the year, improved purchasing and merchandising resulted in gross margin improving from 57.4 to 57.9 per cent.

Meanwhile, the group has plans to launch digital sales channels outside mainland China this year, initially through the development of its own eShops.