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To our shareholders, customers and employees:
We have proceeded on our path toward profitability in accordance with the principle of “growth with sound profitability”, as outlined in the revised medium-term plan “LTH2010”, Link Theory Holdings Co., Ltd. (LTH) recorded increased earnings and profits in this interim fiscal period. Due, in particular, to gross margin improvement and sales growth, our consolidated operating income took a sharp upturn, increasing to 12 times that of the last interim fiscal period. [Steady growth of Theory] Japan and U.S. operations, emphasizing the enhancement of profitability and zeroing in on the improvement of the full price sell-through ratio, succeeded in significantly increasing gross margin. These operations continuously seek to improve their profitability. In Europe and Asia, sales have grown steadily. European operations have opened retail stores in London and Paris, aiming to enhance brand recognition. Asian operations have intensified their focus on opening of new stores in China, an expanding market with enormous growth potential. [Optimization of brand portfolio] LTH will continue to redefine the brand portfolio to improve profitability for the group as a whole especially in terms of operations where the chance of profitability improvement is remote,. In this interim fiscal period, the LTH terminated the operation of the Jean-Michel Cazabat shoe brand in the U.S., as well as that of the Proof brand in Japan. [Making growing and turnaround brand profitable] LTH continues to seek to improve the profitability of the Rosner brand in Europe, focusing efforts in recovering sales, while cutting costs and expenses. LTH seeks to turn the growing Helmut Lang business, into the black by enlarging the customer base and reviewing its cost structures. LTH continues toward achieving its targeted mid-term plan of ¥80 billion in net sales, ¥6 billion of operating income, and a 7.5% operating margin. LTH appreciates your continued support. May 2008 Ricky C. Sasaki President & CEO |
