Companies|The auditor of Esprit, which has operated under Hong Kong ownership and management for the past few years, did not approve the company’s financial statements for last year. Finland’s online store is closed, as are all stores.
In Finland too Esprit, a fashion chain with a large chain of stores, is going bankrupt. The Finnish unit is a subsidiary of Denmark’s Esprit. Denmark’s Esprit filed for bankruptcy on June 16.
The Finnish online store is closed. Franchise-based Esprit in Sello announced already changing the name of the shop and the brands of clothing sold. There is a note on the door of Esprit on Aleksanterinkatu, Helsinki, stating that the business is closed until further notice.
HS reached the lawyer handling the bankruptcy of the Danish company, who said that all stores operating in Finland have been closed and the employees have already been dismissed.
“I understand that the online store is under the control of a German company, so I cannot answer questions about it”, the lawyer Teis Gullitz-Wormslev tells by email.
Esprit is originally a German fashion chain that has also operated in Finland for decades. Since 2000, the company has been listed on the Hong Kong stock exchange and operated under Hong Kong management.
Based on the financial statement papers, the company has made a heavy loss for at least the last ten years, and the turnover has shrunk drastically.
Last year, the company posted a loss of HK$2.3 billion (€280 million) on revenue of HK$5.9 billion (€705 million). At the end of the year, the treasury had dwindled to only 51 million euros.
The Aleksanterinkatu shop was emptied of clothes for sale on Wednesday.
At the company has two headquarters, one in Hong Kong and the other in Düsseldorf, Germany. The official place of registration is Bermuda.
The auditor PWC did not approve the company’s last year’s financial statements. According to the auditor, the company does not have a credible plan for continuing business when the cash register is empty and the cash flow is heavily negative.
According to PWC, the valuations of the assets in the financial statements were also not correct.
More than 40 percent of the company is owned by a Hong Kong resident Ki Yan Karen Lo.
Already of May in the middle of the year, the European headquarters operating in Germany and six other companies belonging to the group in Germany filed for bankruptcy. The Swiss and Belgian companies filed for bankruptcy in March.
About 60 percent of Esprit’s business has come from European retail sales and the rest from online sales.
The expansion into Asia and the United States was not successful, and there has been almost no turnover from Asia. According to financial statement data, the turnover of Finnish operations was 102 million HK dollars last year, or only 12 million euros.
According to the website, Esprit previously had at least 13 stores in Finland. Now Google Map Search only finds the Aleksanterinkatu store in Helsinki, which is therefore closed.
The company’s online store no longer works.
News agency According to Reuters, Esprit filed for bankruptcy for the first time already four years ago, but after that they still tried to revive the business by reducing a third of the employees and closing around 100 stores.
The corona epidemic was poison for the sales of a clothing chain operating on a solid footing. However, the business was heavily loss-making even before that.
Esprit is a well-known and long-standing clothing brand that may still find a buyer. The company has announced that it is negotiating to sell the brand. So even if the company goes bankrupt, Esprit as a clothing brand can still come back to life.
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