CP Lotus 0121

[winston]

C.P. Lotus Shares Fall In Hong Kong After Latest Warning Of Pressure On Retail Profits In China

Hong Kong-traded shares in C.P. Lotus, the operator of a hypermarket chain in China led by the billionaire family of Thai businessman Dhanin Chearavanont, slid by 0.4% yesterday after the company said last Friday it expects to report a loss for the first six months of 2012.

It was the latest sign of trouble for a retail industry struggling with slower-than-expected economic growth and rising costs.

Hong Kong-traded shares in Chinese appliance retailer Huiyin, for instance, have fallen since it issued a first-half profit warning on June 15. (See report here.) Huiyin dropped another 4.5% yesterday.

The projected loss at C.P. Lotus is connected to a slowdown in same-store sales, start up costs associated with new stores and rising wages in China, the company said on Friday. Lotus competes in the country with Wal-Mart, Carrefour and Tesco, among others.

Lotus had 52 Lotus stores and two Lotus life stations in China at the end of 2011.

http://www.forbes.com/sites/russellflan ... -in-china/