Leather products manufacturer/retailer Ascent International Holdings has reported a 20.69 per cent revenue drop for its latest half-year.
Its unaudited results for the period ending September 30 show revenue down to about HK$51.2 million (US$6.6 million) from about HK$64.6 million for the same period last year. This is attributed to a drop in revenue from its manufacturing segment.
Gross profit eased by about 1.28 per cent to $13.2 million mainly because of improved cost control. Gross profit margin increased from about 20.7 per cent to 25.7 per cent. The net loss attributable to the owners of the company was about $11.5 million (2015: $16.8 million).
During the six months, the manufacturing segment accounted for about 69.9 per cent of the group’s revenue (79.5 per cent for the same period last year).
Manufacturing revenue fell by 30.2 per cent to about $35.8 million, mainly because of less demand from China, Hong Kong and overseas markets except for the US.
Sales in Hong Kong fell by about 7.6 per cent to $3.9 million, while sales to China dropped by 57.6 per cent to about $1.9 million.
Sales to other countries, including Australia, India, Japan, Korea, Malaysia and Singapore, decreased by about 39.4 per cent to $11.6 million.
Retail revenue grew by 15.9 per cent to about $15.4 million. The group’s in-house brand sales rose about 19.4 per cent, accounting for 96 per cent of total retail sales. High in-house brand sales drove up gross profit margin from about 67 to 68 per cent.
There was an operating loss of about $2.8 million (2015: $2.4 million).
During the reporting period, the group had nine Area 0264 stores and one Leather Workshop in Hong Kong, the same as for the corresponding period last year.
The group says it will prudently re-examine the use of the resources, including closing the Tsuen Wan retail store when its lease expires.
After Zhonghong Holding and Zhurong Global became the controlling shareholders of the company on November 2 last year, the group has been exploring more opportunities on the mainland, such as developing property-management services in the recreational segment, such as hotels, resorts and theme parks.