Jimmy Choo Shares Plunge In The First Half Of The Year, Slowing Sales Growth

In the challenging and unstable external environment, the UK luxury shoe manufacturer JimmyChooPLC (CHOO.L) slowed its revenue growth in the first half of the year.

PLC (CHOO.L) shares plunged 4.98% on Friday.

The largest market, the European, Middle East and African markets, fell 4.5% year-on-year due to weaker euro against sterling.

The second largest market, the Americas, benefited from a strong dollar and an increase of 5.1% in revenue. However, the fixed exchange rate declined in the region, mainly because of the decline in tourist consumption and the more intense competition.

In the first half of this year, the group added 5 Direct stores, converted 3 franchise stores and completed 7 stores.

As of June 30th, the total number of stores in the world has reached 133.

The group maintained the goal of renovating 10-15 stores and opening 10-15 new stores throughout the year.

In the first half of this year, the growth of 3.3% in the same store was significantly lower than the 5.7% in the 2014 fiscal year, which made the retail revenue growth in the first half of the fixed exchange rate fall from 10.3% in the 2014 fiscal year to 10.3%. The group blamed the closure of a series of shops headed by SloaneStreet flagship store in London, which temporarily affected the sales.

In real terms, retail revenue rose 9.6% to 99 million 700 thousand pounds over the same period.

Wholesale channels have been affected by the decline in demand from Singapore and Malaysia franchised stores to direct outlets and the decline in Eastern Europe and Greece, with annual revenue falling by 5.1% to 53 million 900 thousand pounds.

Empowerment and other revenue benefited from the strong growth of the glasses and perfume series, which doubled to $4 million 900 thousand.

The total revenue amounted to 158 million 500 thousand pounds, an increase of 5.5% over the same period last year, and an increase of 6.5% under the fixed exchange rate, while 12.2% in the 2014 fiscal year, 6.5%.

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The rise was offset by a sharp increase in SG&A and indirect costs. In the first half of the year, the adjusted core earnings EBITDA recorded only 0.5% growth, to 27 million 700 thousand pounds, and the adjusted EBITDA profit margin dropped 90 basis points to 17.5%.

Adjusted net profit was 11 million 100 thousand pounds, up 2.8% from 10 million 800 thousand last year.

PierreDenis, chief executive of JimmyChooPLC, said in its earnings report that the group was satisfied with its performance in the first half of this year, as industry growth slowed to a low single digit.

He expects retail sales in Hongkong, the US and the UK to continue to be affected by the tourism model in the second half of the year. Based on the strong performance of the series of orders for early spring holidays, he expects that the wholesale performance in the second half of the year will offset the weakness in the first half of the year.