Giordano International (709) H2 2024 earnings summary

Executive summary

• Revenue grew 1.2% year-over-year to HK$3,919 million, with a strong 5.9% rebound in the second half, driven by Southeast Asia, Australia, GCC, and online Mainland China.

• Net profit attributable to shareholders fell 37.4% to HK$216 million, mainly due to non-recurring expenses, reduced South Korea JV profit, and Greater China underperformance.

• Gross profit margin declined by 1.4 percentage points to 57.0%, impacted by higher online sales mix and strategic inventory clearance.

• Operating expenses rose to 48.7% of revenue, reflecting one-off CEO severance and transformation program costs.

• Board recommended a final dividend of 6.0 HK cents per share, totaling HK$97 million, with a full-year payout ratio of 104.5%.

Financial highlights

• Operating profit dropped 25.0% to HK$377 million; operating margin at 9.6%.

• Earnings per share: Basic 13.4 HK cents (2023: 21.6 HK cents); Diluted 13.3 HK cents.

• Cash and bank balances, net of bank loans, stood at HK$810 million (down from HK$905 million).

• Inventory at year-end was HK$508 million, with turnover at 110 days.

• Store count decreased to 1,732 from 1,822.

Outlook and guidance

• Launching 'Beyond Boundaries' five-year plan focused on brand revitalization, digital-first, Greater China, and unified operations.

• Targeting high single to low double-digit CAGR revenue growth from 2025–2030, with profit margin trending toward historic levels.

• 2025 ambition: revenue growth of 3–5% with profit growing faster than revenue.