CorporateInformation ExecutiveDirectors ■Ms.CHIUChristinSuYi(Chairperson) ■Mr.PAKWilliamEuiWon(ChiefExecutiveOfficerandChiefOperatingOfficer) ■Mr.SCHLANGMANNWolfgangPaulJosef ■Mr.WRIGHTBradleyStephen IndependentNon-executiveDirectors ■Mr.CHUNGKwokPan ■Mr.GILESWilliamNicholas ■Mr.HAKeeChoyEugene ■Ms.LIUHang-so ■Mr.LOKinChingJoseph ChiefFinancialOfficer ■Mr.WONGBrianShekKae CompanySecretary ■Ms.FONGYeeMei Principalbankers ■HangSengBankLimited ■TheHongkongandShanghaiBankingCorporationLimited ■DeutscheBankAG Auditor ■PricewaterhouseCoopersCertifiedPublicAccountantsRegisteredPublicInterestEntityAuditor Principallegaladvisor ■Dechert PrincipalshareregistrarMUFGFundServices(Bermuda)Limited 4thFloorNorth,CedarHouse41CedarAvenue HamiltonHM12Bermuda HongKongbranchshareregistrar TricorSecretariesLimited 17/F,FarEastFinanceCentre16HarcourtRoad HongKong RegisteredofficeClarendonHouseChurchStreetHamiltonHM11Bermuda InternationalHeadquarters13thFloor,ChinaUnitedCentre28MarbleRoad,NorthPointHongKong t:+85231980330 f:+85223625576 Forenquiriesfrominvestorsandequityanalysts,pleasecontact: Investorrelationsdepartment 13thFloor,ChinaUnitedCentre28MarbleRoad,NorthPointHongKong Ms.LUIJennifer t:+85231980378 e:Jennifer.Lui@esprit.comesprit-ir@esprit.com Website www.espritholdings.com Sharelisting ListingonTheStockExchangeofHongKongLimitedsince1993StockCode:00330 Level1sponsoredAmericanDepositoryReceiptprogramsince2015 StockCode:ESPGY Contents ManagementDiscussionandAnalysis2 FinancialSection IndependentReviewReport10 InterimFinancialInformation11 NotestotheCondensedConsolidatedInterim16 FinancialInformation OtherInformation26 GlossaryofTerms31 ManagementDiscussionandAnalysis TheCompanyfacedmanychallengesinthefirsthalfof2022.TheGroupbelievesitsdynamiccorporatestructure,currentmanagementteam(the“Management”),anddedicatedstaffatESPRITwerethecorereasonsallowingtheCompanytonavigateatoughenvironmentandremainprofitableduringthesixmonthsended30June2022(the“Period”). ThestrategiesinstitutedbytheManagementteamallowedtheCompanytoactandrespondquicklytouncertaintiesontheCompany’sbusinessandoperations,includingsupplychaindisruptions,changesineconomicconditions,increasingrawmaterialprices,decreaseinconsumerconfidence,discretionaryspendingsandescalatinggeopoliticaltensions. InEurope,theconflictinUkrainehassuppressedconsumerspendingappetiteandtheeffectsfromRussiansanctionshaveresultedinescalatingenergycostsandfoodprices.Theglobaleconomicenvironmenthastakenatollfromthehighinflationandinterestratehikes,andhasaffectedtheforeignexchangemarket.TheEuroweaknessagainsttheUSDollarhadamaterialimpactontheCompany,asmostoftheCompany’srevenueisdenominatedinEuros,whiletheUSdollaristhemaincurrencyusedformajorityoftheCompany’ssourcingactivities.DisruptionstothesupplychainincludinglogisticsintheCompany’sprincipalsourcingregionshavecausedadditionalstressaswell.TheCompanyisactivelyandcarefullymonitoringtheaforementionedissuesanditseffectsontheoperationsoftheCompany,instigatingmeasurestocounteranydetrimentaleffectsthereto. Despitethechallengingconditionscitedabove,theCompanyispleasedtoinformshareholdersandstakeholdersthatitsoutlookisgenerallyoptimisticinnatureandwouldliketosharenewinitiativeswhichwillbebeneficialtotheCompany’sprospectsgoingforward,suchas: 1)Stringentcostcontrolandcostcuttingthroughcorporatere-structuringandrelatedmeasures.TheCompanywillalsoinstigatemeasurestomitigateagainstforeignexchangetranslationfluctuation; 2)Closingunprofitablestoresandoutletsandrenegotiatingrentalleasestoensurethattheretailchannelwillre-emergeasaprofitableandkeysegmentfortheCompany; 3)Terminationofproductlinesthathavelowgrossprofitmargin,replacingthemwithcollectionsandcapsuleswithsubstantiallyhighermargins.Ourtimelyreadjustingoursourcingwillkeeptheobsoleteinventoriestoaminimumlevel; 4)SignificantlyinvestinginrebuildingESPRIT’sbrandequity,re-establishingandimprovingtheESPRITbrandimage,retainingandregainingloyaltieswithlong-timecustomers,andsecuringnewcustomers,particularlytheyoungergeneration; 5)RevampingtheCompany’ssaleschannelsintoanomni-channelstructurewithdeeperfocusonE-commercetobemoreattractiveanduser-friendly; 6)TheGroup’scontinualimprovementininventorymanagement,togetherwiththefadingeffectsofthePandemicinEurope,allowedtheGrouptowritebackasubstantialinventoryprovision,detailsofwhicharefurtherdisclosedintheWorkingCapitalManagementsectionaboutinventories; 7)DemonstratingtheCompany’swell-knownandlongstandingcommitmenttobeintheforefrontofbeingasociallyresponsiblecorporatecitizeninareassuchastheenvironmentandsustainability;and 8)Re-enteringorincreasingourpresenceinkeyAsianmarketssuchasHongKong,Korea,Taiwan,andthePhilippines,intheformofpop-upstores,proprietarywebsitesandpartners’portals.Thesewerelaunchedwithinashortperiodoftime,despitePandemicchallenges–demonstratingESPRIT’sprowess,agilityandefficiency. ThefinancialresultsoftheCompanywhicharediscussedingreaterdetailbelow,demonstratesthatwithboldaction,agilityandhardwork,theCompanyhastakenconsistentstepstomovetowardsabrigh