Shandong Ruyi's SMCP Growth Accelerated, China's Market Surged Over 30%

SMCP SAS (SMCP.PA) has accelerated growth in the two quarter, up 10.1% to 265 million 700 thousand euros from the same period last year, and the growth rate of fixed exchange rate 8.9% was faster than that in the first quarter of 7.2%.

French light luxury fashion group reaffirmed its full year expectations in the interim results. It is estimated that the annual sales growth of 9-11% will be recorded after the impact of the exchange rate is eliminated, while the adjusted EBITDA profit margin will remain at 16.9% level in fiscal year 2018.

International business is still taking the lead. 13.7% of the fixed exchange rate growth is mainly driven by an increase of over 30% in the Chinese market. The French domestic market is growing again, even though tourist consumption is still facing challenges. In 4-6 months, the Asian Pacific market fixed exchange rate increased by 23.4%, the Americas market increased by 13.3%, the EMEA market increased by 7.5%, and the French domestic market grew by only 0.5%.

SMCP said that the first half of the Group recorded a comparable sales decline of 0.7%, mainly due to the challenge of the French market at the beginning of the year, but 33 new stores in the two quarter stimulated the company to accelerate growth.

By the end of June, the company operated 1207 direct outlets, a net increase of 27 in the two quarter, and a net increase of 6 to 311 in the licensed stores.

Maje, Claudie Pierlot and Sandro accounted for 40%, 11% and 49% respectively in the first half of the year, and 10.7%, 4.5% and 8.6% respectively in the two quarter. The proportion of e-commerce channels increased by 50 basis points to 14.8%.

At the end of last month, SMCP SAS made the first acquisition of the group in nearly ten years, and bought the French menswear light luxury brand De Fursac. De Fursac will also be the first independent men's wear brand in SMCP SAS. At present, only three of the group's largest brands are men's wear businesses.

According to the press release of SMCP SAS, the De Fursac, founded in 1973, now has 54 stores in 29 cities in France and Switzerland, and 41 million 400 thousand euros in 2018. In the context of the continuing recession of the French clothing market, it has achieved 5.4% comparable sales growth, and the EBITDA profit rate is higher than that of SMCP SAS.

The group also mentioned that De Fursac has always been the top three Department of French luxury department in French department stores, and is also popular among international customers, especially Chinese tourists.

As of the mid-term results released in July 24th, Shandong Ruyi technology group holds a controlling stake in SMCP SAS 53.7%, with management ownership of 6.4%.