Esprit’s turnover for the 6 months ended Dec. 31 was up by 32.0 percent to HK$8.00 billion (€804.4m-$1.03bn), but sales of shoes and accessories only went up by 2 percent to approximately HK$800 million, or 10 percent of the total turnover. The segment’s slow growth was previously explained by the brand’s more selective policy of retail partnerships in Europe, but asked to explain why there was again such a small sales increase for footwear in the latest period, Esprit officials in Hong Kong said last week, “It’s all about product, and our product is not good enough.”

Esprit sells its shoes and leathergoods through its own stores in Asia, through Esprit stores and other specialty stores in Europe and through various retailers in the USA, where Nine West has the Esprit footwear license and a 5-year contract. Esprit is moving into the USA with caution, preferring to be in “triple-A” locations rather than everywhere like before. Esprit is happy with its deals with Macy’s, Dillard’s, and especially Marshall Fields. The group hopes to open 10 stores in New York City within a year, but the USA is not regarded as a vehicle for growth over the next 5 years.

On the other hand, the Hong Kong-based fashion group is extending its geographical reach in Europe beyond the core German market. During the latest 6-month period, Esprit’s overall sales grew significantly in France (up 72 percent), Scandinavia (up 62 percent), Benelux (up 44 percent), and Germany (up 39 percent). On a comparable basis, sales through Esprit stores were up 5.3 percent overall and 15.6 percent in Europe. The U.K. is the next European market to conquer. Net profit was up 53.3 percent to HK$885.9 million (€89.0m-$114.0m), and it would have increased by 40 percent without the appreciation of the euro. The wholesale order book through May shows an increase of close to 20 percent.