SHIRBLE DEPARTMENT STORE HOLDINGS (CHINA) LIMITED Shirble Department Store Holdings (China) Limited provided group earnings guidance for the year ended 31 December 2012. The board of directors of the company, together with its subsidiaries, informed the shareholders of the company and prospective investors of the shares of the company that the group may incur a net loss for the year ended 31 December 2012, as compared with the net profit in 2011, due to the following principal reasons: there was a moderate decrease in the direct sales and the commission income received from concessionaire sales generated from the existing department stores of the group. The decrease was principally due to the intensed competition in the department store business in Shenzhen, the People's Republic of China and the overall economic slowdown in the PRC in 2012; the start-up loss incurred by the group's newly opened department stores in 2012.
The group opened five new department stores in 2012, and the revenue generated from these department stores was not sufficient to fully recoup the incidental expenses, depreciation, and the lease payments incurred by the group for these newly opened department stores; and there were continuous increases in the administrative expenses, operating costs, and staff cost of the group principally due to the expanded department store network of the group and the new senior management team members of the group.
