Crocodile Garment sales slip
Apparel Analyst, UK
HONG KONG – [11.04.06] Crocodile Garments Ltd, the Hong Kong apparel firm currently at the centre of a family row, has posted significantly higher profits on lower sales for the 6 months ended Jan 31st 2014.
Compared to the same period in fiscal 2005, revenues were HK$198.24 million, down 7% compared to HK$212.65 million, but net profits soared to HK$132.77 million from HK$18.13 million for the first half fiscal 2014. This was thanks largely to a revaluation of its property portfolio which accrued HK$146.53 million in the period
Sales were weaker despite a 10% rise in Hong Kong retail sales during the first half 2014, but this was not enough to offset a drop in sales in mainland China of 24.8% due to ‘intense competition’ in that market.
The company, which is part of Lai Sun Group is about the change hands between two brothers who are at loggerheads with each following the death of their father who founded the company. Lai Sun Garment, was controlled by late founder Lim Por-yen, but ownership passed on to his son, Peter Lam, who will register a loss of HK$175 million from the sale of the Crocodile Garments stake to his brother, Lam Kin-ming. Lai Sun Garment is selling its 51% stake in Crocodile Garments for HK$192 million which will reduce its holding in Crocodile to just 3.9% as it looks to exit the garment business. Crocodile Garments contributed HK$390 million out of Lai Sun Garment’s turnover of HK$482 million in the year ended last July.
More recently, a report in the Shanghai Daily newspaper said the company has finally settled a long-running dispute with the Lacoste Group over the French firms famous Crocodile logo. The report, published last week, said the matter has now been settled after the Hong Kong firm relaunched its Crocodile brand with a new logo, which now features a left-facing golden crocodile with a vertical tail.
