Bonjour stores are trading profitably again.

The beauty products retailer managed to slash its rent-to-sales ratio by a quarter in the first half of this year, taking maximum advantage of landlord flexibility in a time when demand for high street retail space declined.

“The group has continued to seize opportunities by closely monitoring market changes, analysing rental trends in various districts in order to extend the store network to different communities, and carefully expanding its business,” explained Wilson Ip Chun Heng, Bonjour’s chairman and executive director in commentary on its interim results.

“Benefitting from the significant drop in shop rental expenses mainly due to more reasonable monthly rents agreed upon renewal or new contracts, particularly for street-level stores, the group significantly improved cost efficiency. The retail store rent-to-turnover ratio amounted to 15.5 per cent, compared with 20.4 per cent last year.”

Two new Bonjour stores opened during the half year, but its total network was down year on year from 43 stores to 36 as of June 30.

While total group sales of HK$932.3 million were up only 1.7 per cent on the same period last year, lower rents and other efficiencies converted a loss of $57.8 million last year into a profit attributable to shareholders of $7.4 million. Same-store sales rose 14.9 per cent.

“The group has kept an eye on the latest trends to accelerate sales performance by selecting the trendiest products from across the world and timely adjusting the product portfolio to optimise product offerings, and enhancing customers’ shopping experience in the fast-changing markets,” said Heng. “At the same time, the group has organised different promotional activities and offered discounts during different festivals to attract new customers, and as a token of appreciation to reward existing customers for their continuous support.”