China Apparel Holdings Expects Net Profit Margins To Decrease By 60% In 2019.

On the 21 day, China apparel Holdings Limited announced that as expected, the net profit margin of equity holders of the parent company will be substantially reduced by 60% at the end of December 31, 2019 compared to 60 million 179 thousand yuan in the same period in 2018.

In the announcement, China apparel Holdings said that the decline in net profit was mainly affected by 4 factors. First, the slowdown in macroeconomic growth and the downturn in the retail market led to a decline in the number of retail outlets, revenues and gross margins. Secondly, the government's financial incentives, tax rebates and interest income were reduced; thirdly, the amortization of equity costs settled by equity settlement; finally, the impairment of goodwill was also a major factor.

China apparel holdings is mainly engaged in the design, production, marketing and sales of clothing products and accessories, and focuses on men's wear.

It is understood that China apparel holdings in July 2019 issued a profit warning for the year, and expects the group's net profit in the medium term as of June 30, 2019 will be significantly reduced by at least 40% compared with the same period last year. In the mid-term announcement released in August, the drop was 46.3%. As for the reasons, the continued slowdown in macroeconomic growth and the weakness of the retail market, as well as the impact of e-commerce on traditional retailers, are considered to be related factors.

In the face of the sharp decline in net profit and the expected fall of nearly 60% in late 2019, China apparel holding board remains optimistic that the group's strategy has made positive progress, and its operating and financial conditions remain stable.