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China, Taiwan help Harvey Nichols parent survive Hong Kong retail bust

Harvey Nichols’ store at Pacific Place.

After experiencing one of “the worst retail environments Hong Kong has ever faced” Harvey Nichols parent Dickson Concepts has managed to maintain a profit despite a 22.5-per-cent decrease in sales. 

A strong performance in Mainland China mitigated the damage in Hong Kong where sales were down by 31 per cent due to the Covid-19 pandemic and the closure of the border to tourists for more than one year now. 

On turnover of US$293 million (HKD 2.275 billion) Dickson Concepts achieved a profit attributable to shareholders of $59.5 million (HKD 461.8 million), down 28.5 per cent from the previous year. 

In China, Dickson Concepts turned from loss to profit after sales soared by a record 109 per cent. Sales in physical stores rose by 90 per cent and online by 325 per cent. 

In Taiwan, the group boosted profit by more than 300 per cent which it said was the direct result of continuing improvement in consumer sentiment, together with stronger margins and aggressive control of costs and inventory.

The achievement outside Hong Kong is significant given the territory has traditionally accounted for the vast majority of sales. In the latest year, that share was down to 76.5 per cent. 

The company now has seven stores in Hong Kong, 32 in China and 25 in Taiwan. Besides Harvey Nichols, its brands include Beauty Avenue, S T Dupont, Dickson Watch & Jewellery, Roger Vivier, Hogan and Tod’s.  

In the latest year watches and jewellery represented 46 per cent of its overall sales, cosmetics and beauty products 29 per cent, fashion 20 per cent and the balance securities trading, which contributed about one-fifth of the company’s net profit. 

In a statement, Dickson Concepts expressed pessimism about the continuing impact of the pandemic on the business, noting especially how severely its highest growth market, Taiwan, might be affected by the current outbreak. 

In Hong Kong, with uncertainty on the timing of reopening of borders, the possibility of a fifth wave outbreak of Covid-19, and continued high unemployment, it does not expect any real improvement in the retail climate in the foreseeable future.

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