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Public company info - Trinity Ltd. , 00891.HK

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Trinity Ltd., 00891.HK - Company Profile
Chairman QIU Yafu
Share Issued (share) 3,598,000,000
Par Currency Hong Kong Dollar
Par Value 0.1
Industry Apparel
Corporate Profile Business Summary: The Group is principally engaged in the retailing and wholesale of high-end to luxury menswear in Greater China and Europe, as well as licensing its major brands globally. The jointly controlled entities/associates are retailers of luxury fashion and accessories in South Korea and various countries in Southeast Asia. Performance for the year: The Group’s total revenue for 2019 was HK$1,962.2 million, which increased by 13.9% compared to last year. The Group recorded a core operating profit of HK$161.3 million, compared to a core operating loss of HK$248.1 million last year. The Group incurred a profit for the year of HK$50.4 million in 2019, which translates into an earnings of 1.4 HK cents per share. Business Review PROFITABILITY IN 2019 HIGHLIGHTS the group’s COMPETENCE Hunkering Down In a year filled with tremendous challenges from near and far, the fact that the Group is able to sustain profitability must certainly be regarded as an outstanding achievement. However, as much as the group are pleased by the Group’s profit, it would be remiss to declare that the group’s path to brighter days is assured. On the contrary, the group are well aware of the significant challenges ahead, many of which are unprecedented. Yet with great challenges lie significant opportunities that the group will make every effort to seize. Already, the past year’s performance has enabled us to clearly examine both the group’s strengths and weaknesses. While the group’s wholesale business performed encouragingly, helping to drive the Group’s profitability, the retail segment suffered due to a weakened global economy resulting from the USChina trade dispute, while in Hong Kong, social unrest during the second half of the year created even stiffer headwinds for the retail sector as a whole. The resultant rise in competition that featured aggressive promotion and discount practices, which the Group was forced to adopt, led to a decline in profit. As market conditions began to deteriorate, the group did begin to employ a variety of defensive measures, including curbing marketing and advertising expenditures, as well as aligning with an online retail platform to manage inventory. Reinforcing Bricks and Webs As the best defence is a good offence, the group also sought to further advance the Group’s omnichannel operations, while concurrently revising fashion portfolios for the group’s premium self-owned brands – Cerruti 1881, Gieves & Hawkes, and Kent & Curwen. In respect of the former, the group completed the refurbishment of several stores during the year, and will be introducing a concept store for Kent & Curwen, all with a decidedly younger edge. Beyond brick-and-mortar stores, the group are also fortifying the group’s presence online, as well as relevant social media channels. E-commerce is no longer a new frontier, but rather an important market. According to a forecast from a leading research firm, the global online fashion market is predicted to reach US$765 billion by 2022, a projected increase of US$281 billion, or 58%, from 2018, with 36% of total fashion retail sales expected to occur online by that time1 . With millennials and Gen Xers accounting for the two largest groups of online shoppers – 67% and 56% respectively, as well as men spending 28% more than women when shopping online2 , such developments highlight the tremendous opportunities that e-commerce presents. Correspondingly, the group’s e-commerce team is continuously and conscientiously enhancing the group’s online presence, so that the group maximise the group’s impact on a global scale. While market penetration is crucial, whether by traditional or online means, delivering the right products remain fundamental to the group’s success at the end of the day. Mindful of the group’s target clientele, the group instructed the group’s design team to introduce more youthful collections, extending to unisex clothing that is in tune with the times. Furthermore, the team will be creating accessories that are part and parcel of todays aesthetic. Yet, another business avenue the group are examining involves collaborating with other labels that will allow us to welcome an even wider breadth of customers. Underpinning the group’s creative efforts will be Ruyi, which, with its large portfolio of advance materials, will ensure that all of the group’s clothing are not only visually appealing but possess properties that are desired and complement the wearer. As delivering the best in services is also imperative in aligning with the premium nature of the group’s brands, the group have continued to examine ways to better serve the group’s discerning customers. Besides offering appropriate training, the group have sought to recruit capable frontline staff who possess the sensitivities to serve the increasingly young yet welltravelled clientele that are frequenting the Group’s stores. In order to acknowledge, reward and encourage frontline staff for their efforts, the group have also developed new incentive programmes that take into consideration the harsh retail conditions they are presently facing. Testing Times The harsh retail conditions are likely to persist well into 2020, as decelerating global economic growth and intensifying competition will inhibit value creation in the fashion industry. This sentiment is reflected in a recent survey involving 290 global fashion executives, the majority of whom expected a slowdown in 2020, regardless of value segment or geography3. Despite facing potentially the harshest period in recent years, the group will continue to pursue the group’s “Go Global” goal by reinforcing the aforementioned omnichannel operations, as well as providing support to staff on the frontlines. the group will also optimise the group’s supply chain by enhancing relations with factories so as to achieve greater efficiency in areas such as procurement, turnaround time and speed to market, leading to lower costs and greater profitability, among other benefits. Prospects: Belief and Confidence/Grit and Determination In view of the many formidable local and international challenges on the horizon, the Group will continue to leverage the relationship between Trinity and, its controlling shareholder, Ruyi, to ensure not only that the global retail restructuring strategies are implemented effectively and expeditiously, but also to tap markets that were previously unexplored, such as the wholesale segment. Indeed, this newest endeavour, which specifically caters for the upper echelons of the corporate world, has played a pivotal role in lifting the group’s performance in the year under review; helping the Group raise the brand profile as well as offsetting the decline in the retail segment in the Hong Kong market. As there remains tremendous room for growth, the group will dedicate still greater effort towards the prestige wholesale segment, while leveraging Ruyi’s resources in the formal wear market. While encouraged by the wholesale business, the group are aware that the group’s growth aspirations can only be achieved through contributions from all key facets of operation. Consequently, the group will take a suitably holistic approach; seeking to better reaches the group’s discerning customers by creating incomparable omnichannel experiences that befits the prestige and sophistication of its self-owned brands. This will include capitalising on the group’s management team’s invaluable experience and leadership to help re-energise the group’s brick-and-mortar stores and the clothes found within so that they emanate a sophistication and youthful vibrancy that is consistent with the group’s target demographic. In addition, the group will further leverage e-commerce to strengthen the group’s online presence, while concurrently reinforcing ties with established online retail platforms, especially those having links with Ruyi. Though 2020 looks difficult and uncertain due to various macroeconomic factors, the group maintain the view that the glass is half full. With the group’s highly experienced management team at the helm, clear business direction, optimised workforce and unstinting ties with key stakeholders, the group will ensure that the group’s “Go Global” goal will become a reality, and Trinity continues to grow from strength to strength.

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