Stiff competition dents profits at The Hour Glass

The Hour Glass has clocked in a 6 per cent drop in second quarter net profit to $9.5 million.

This was despite revenue rising by 14 per cent to $160.4 million for the three months to Sept 30.

This was achieved due to an expanded retail network and increased marketing activities.

Gross margins were lower at 22 per cent compared to 23.7 per cent in the same period last year, due to a more competitive marketplace.

Operating expenses were higher due to staff costs and rentals.

Earnings per share slipped to 4.02 cents from 4.27 cents previously while net asset value per share dropped marginally to $1.40 compared to $1.41 as at March 31.

The Hour Glass noted that global economic uncertainty and slowing Asian economies are expected to affect consumer sentiment and the demand for hard luxury goods.

"Barring any unforeseen circumstances, the group is cautiously optimistic of its outlook for the remainder of the financial year," it said.