Shoe retailer Belle International (1880) expects its net profit for the year ended February 28 fell 15 to 25 percent from a year back, mainly due to the under- performing footwear business.
Given that the profit of the previous fiscal year was 2.9 billion yuan (HK$3.26 billion), it is expected that Belle will record at least 2.2 billion yuan of net profit in fiscal year 2016-2017.
The weak footwear business led to an impairment of related goodwill and other intangible assets, dragging down the net profit, the firm explained in its profit warning issued yesterday.
The group made adjustments to the share award scheme to motivate management members more effectively, resulted in a growth in relevant expenses.
If the annual result comes in line with expectation, it will be the second year for the firm to record falling profit. Its net profit slumped year on year 62.4 percent in the previous fiscal year.
The firm also revealed that the same- store sales of footwear slid 6.2 percent in the fourth quarter while those of sportswear and clothes rose 4.5 percent in the fourth quarter.