With challenging retail conditions in Hong Kong and Macau, fashion group Bossini sales have fallen by 8 per cent, with a 12 per cent drop in gross profit.

Its revenue for its latest fiscal year was HK$2319 million (US$298.9 million) compared with HK$2523 million last year. The gross profit was $1107 million, down from $1264 million), while gross margin dropped by 2 per cent to 48 per cent. Profit for the year attributable to the owners totalled $292 million ($115 million the previous year).

Excluding a gain of $268 million on the disposal of property and leaseback arrangement, the profit attributable to owners would be just $25 million (2015: $115 million).

Along with weak local sentiment, unseasonably warm winter weather in Hong Kong and Macau intensified competition. Same-store sales dropped 6 per cent overall, but in the second half of the financial year the decline narrowed to 1 per cent from the first-half’s 12 per cent decline.

As of June 30, the group had a presence in 32 countries and regions with an overall store count of 947 (938 the previous year). Of these, 280 (2015: 257) were directly managed and 667 (2015: 681) franchised stores.

A range of licensing programs during the year helped enhance the group’s brand value.

“To cope with challenges we are now facing, we will expand our market share for young adults and develop more products that focus on better functionality, of which the market demand is solid,” says CEO/executive director Edmund Mak.

“We will also refine our product fit and grading system to target a wider customer segment, and develop our line for kids even further.”