NEWS WRAP: Samsonite chases U.S. dual listing to move closer to home

The luggage maker cited low liquidity in Hong Kong for its pursuit of a dual listing, as it reported its sales were roughly flat in the first half of the year

By Teri Yu

Hong Kong-listed luggage maker Samsonite International S.A. (1910.HK) is pursuing a dual listing in the U.S. to better match its global footprint and strategic priorities and boost its trading volume, according to its interim results announcement on Wednesday.

The company, whose main headquarters is in the U.S., has been mulling a potential second listing since early this year, joining other international brands like L’Occitane and Prada in exploring options beyond their current listings in Hong Kong where trading volumes are relatively low and their names are less known to local investors. Samsonite debuted on the Hong Kong Stock Exchange in 2011 in a bid to raise its profile in the region and tap Asian investors.

The company revealed its U.S. listing plan in its interim results, where it reported its sales fell by a slight 0.4% to $1.77 billion year-on-year in the first six months of 2024. On a constant currency basis, its sales increased by 2.8%. Last year was a record year for global travel, as people returned to the road after the pandemic.

Sales for the company’s Samsonite brand rose 5.8%, with the namesake brand recording growth across all regions. Sales for its Tumi brand only grew 0.3%, while its American Tourister line suffered a 0.9% sales decline.

The company’s gross profit margin rose to 60.2% from 58.8% the previous year as a result of a greater share of sales from its direct-to-consumer channels, shifts in its brand mix, and a disciplined approach to promotional discounts. Its profit rose 7.7% year-on-year to $164.3 million.

The company acknowledged that heightened macroeconomic uncertainties and softening consumer sentiment in some markets will continue to weigh on its performance for the rest of 2024. Reflecting that, year-on-year sales growth slowed to 1.5% in the second quarter of 2024, down from 4.1% in the first quarter, with particularly stark declines in Asia and North America. China experienced a 3.5% decline quarter-on-quarter from the first to second quarters due to declining consumer demand.

Despite the current challenges, the company said it remains optimistic over the longer term. “Trends in global travel and tourism remain positive, supporting demand for our products,” said CEO Kyle Francis Gendreau. “International tourism arrivals continue to improve and are projected to exceed pre-pandemic levels in 2024 … As consumers continue to prioritize travel over other discretionary spending, our prospects remain bright despite the current headwinds.”

Samsonite stock tumbled on Thursday the day after the results came out, and were down about 12% late in the trading day.

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