Beauty retailer Bonjour Holdings has warned shareholders of a “substantially increased loss” for the current year as the social unrest and falling Mainland Chinese visitor numbers take their toll.
Last year, Bonjour Holdings reported a net loss of HK$39.6 million (US$5 million). In a letter to shareholders, chairman Wilson Ip did not put a figure on the loss anticipated in the year to December, but his words were ominous.
“The group’s turnover has deteriorated severely and is expected to record a double-digit year-on-year decline for the year,” he said. “The average gross profit margin also decreases mainly due to the change in sales mix, consumer’s spending patterns and the increase in the promotion to attract customers.”
He said Hong Kong’s economy suffered “an abrupt deterioration” in the second half of the year when consumption and tourism-related sectors were hit hard by local social incidents.
“Moreover, the global economic slowdown and escalated US-Mainland trade tensions weighed further on the Hong Kong economic outlook.
“Facing such an economic downturn, in a view to ease the difficult situation, the group now has key focuses on cost optimization and value creation by streamlining operational efficiency and better business planning to build or sustain our competitive advantage.”