The retailer of high-end brands such as Gucci and Prada, alongside fast fashion labels like Zara and Pull&Bear, saw profits during the first nine months of the year fall 17.2 percent to P1.26 billion while overall sales increased by 6.7 percent to almost P20.2 billion.
SSI, led by CEO Anthony Tantoco Huang, shifted its expansion focus to the luxury and bridge segment—whose brands also include Hermès, Cartier, and Tory Burch—and casual brands, such as Lacoste and Gap.
Evolving strategy
Luxury and bridge saw a notable 14.4-percent increase in gross selling area to about 15,387 square meters during the nine-month period while the casual segment grew 20.4 percent to 14,249 sqm.
Fast fashion, which accounts for the largest share of space, dropped 3.3 percent to about 40,674 sqm while other brands, such as Pottery Barn, Shake Shack, and Beauty Bar, grew 14 percent to 24,155 sqm.
Despite its smaller selling area, luxury and bridge accounts for about 32 percent of total sales (P6.45 billion), which is similar to fast fashion’s 33.8 percent contribution (P6.85 billion).
Footwear, luggage sales fall
SSI Group also expanded footwear, accessories, and luggage by nearly 10 percent to 17,351 sqm to counter slowing sales, as segment revenues saw the biggest decline at 16.2 percent from January to September this year.
SSI grew its total store count by 7.4 percent to 565 outlets during the first nine months of 2024.
Mixed results in 2024
In terms of sales, the casual segment rose by 11.8 percent, while “other” brands grew by 23.0 percent.
Luxury and bridge grew 10.6 percent as fast fashion edged up by 1.2 percent.
SSI Group also saw operating costs rise 12.9 percent to about P7.3 billion.
Costs as compared to revenues grew to 35.9 percent from 34 percent last year, impacting gross profit margins, which slipped to 44.2 percent from 44.9 percent last year.
Higher inventory ahead of holidays
SSI Group ended the third quarter with inventory valued at P12.1 billion, up from P11.3 billion a year ago, reflecting its expanded footprint.
“The group experiences seasonal fluctuations in its operations. The group’s sales typically peak during the fourth quarter of the year due to the increased sales attributable to the Christmas and New Year holidays,” SSI Group said.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
