Bestseller China Equals DK Parent Company In Profits

A recently published financial analysis of Bestseller Fashion Group China, the Chinese division of Denmark's largest clothing company, reveals that the Middle Kingdom operation turned a total 2008 profit fully just as big as the Danish parent juggernaut. According to the analysis Bestseller China concluded 2008 with an annual turnover of 3.5 billion DKK (470 million EUR), equal to 1.2 billion DKK (161 million EUR) in pure after-tax profits.

Within the same timeframe Bestseller in Denmark managed an annual turnover of around 11 billion DKK (1.48 billion EUR) which also amounted to a total of 1.2 billion DKK in 2008 profits. According to Huaxia D&B China – a branch of the Dun & Bradstreet analysis company and the supplier of the financial analysis – the atypical Chinese accounting practices may even mean that Bestseller China's turnover figures underestimate total sales throughout the Middle Kingdom.

"These are very strong accounts, and indicate both a healthy company and the fact that the Chinese market is still growing.  And at the same time the accounts also show that Bestseller China's profit performance is good", says René Ostenfeld, risk management specialist at Dun & Bradstreet. "All in all the company gets a grade, a so-called EMMA score, of 1, which puts the company in the best group that only 10% of all companies qualify for."

Bestseller China currently operates 2,900 stores across the country, with 300 having been added to the tally in the otherwise recession-hammered 2008.

The company was established by two Danish businessmen – Allan Warburg and Dan Friis – in 1996, when they managed to persuade Bestseller-owner Troels Holch Povlsen to invest in the project against a 50% share of the operation. The other half of the company is divided equally among the two founders who also handle the actual running of Bestseller China. The company has managed to completely outrun such huge international retail chains as Hennes & Mauritz, Inditex and Gap on the Chinese domestic market.

Full story in Danish

News category: Denmark