Samsonite Sees Raising Japan, India Prices Further on Currencies
Samsonite International SA (1910), the world’s largest branded-luggage maker, said it will raise prices in Japan and India again this year as weakening local currencies cut the dollar value of sales from the countries.
The luggage maker will raise prices in Japan by 10 percent starting September and soon increase prices in India by 7 percent, Asia Pacific and Middle East president Ramesh Tainwala said at an earnings press conference in Hong Kong today.
The price revisions at the Mansfield, Massachusetts-based company follow an 8 percent increase in India earlier this year and a previous 10 percent raise in Japan. The Indian rupee today plunged past 68 per dollar to a record low amid concerns about capital outflows and an unprecedented bond-buying program by the Bank of Japan drove the yen to the weakest level in more than four years in May.
This year “has been a much calmer year on the currency front, and this has caused fewer distortions to our sales and profits,” Chief Executive Officer Tim Parker said in a filing to the stock exchange today. “There remain a few exceptions, in particular the Japanese yen and the Indian rupee, both of which have declined considerably.”
Japan made up 3 percent to 4 percent of group sales and India accounted for 6 percent, according to William Yue, investor relations director.
Samsonite fell 6.6 percent to HK$18 as of 1:16 p.m. in Hong Kong trading. The city’s benchmark Hang Seng Index dropped 1.6 percent.
Adjusted net income rose 5.4 percent to $92.9 million in the six months ended June 30. Profit was projected at $90.3 million according to the average of three analysts’ estimates compiled by Bloomberg. Sales rose 16 percent to $983.6 million.
The company has the financial capability to spend as much as $1 billion on acquisitions, Parker reiterated at the press conference.
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