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Mar 19, 2014
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Samsonite 2013 profit up 19 percent

Mar 19, 2014

HONG KONG - Hong Kong-listed luggage maker Samsonite reported a 18.6 percent rise in its 2013 profit, missing estimates, as tougher conditions in China countered its expanding business in Asia.

Samsonite earned $176.1 million in the 12 months ended December compared with $148.4 million a year earlier, the company said in a statement on Wednesday, before the Hong Kong market open. Analysts on average were expecting a profit of $188.17 million, according to Thomson Reuters data.

Samsonite, which sells luggage under the Samsonite, American Tourister, High Sierra and Hartmann brands, stands to benefit from rising middle class incomes in China. But in recent months, Beijing's crackdown on corruption and its austerity drive have pushed more wealthy Chinese to make their luxury purchases abroad.

Samsonite said 2013 had been more subdued after several years of stellar growth in China. Overall net sales increased 15 percent to $2.04 billion last year.

"Clearly the slackening in the overall growth rate and official policy on gift-related purchases, have had an impact on demand," Chairman Timothy Charles Parker said in the statement.

"We have plenty of new product and brand initiatives in China, and remain confident that this market will continue to lead the region in terms of growth and profit contribution," Parker said.

Samsonite said it saw its business in the United States grow by almost a quarter last year and it has plans to further expand its retail network in 2014.

Shares of Samsonite have fallen 12.3 percent so far this year compared with a 7.4 percent drop in the benchmark Hang Seng index.

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