Li & Fung turnover in the first half ended June 30 fell 9.6 per cent from a year earlier. Total margin as a percentage of turnover was 10.5 per cent. The logistics business saw turnover increase 10.9 per cent from a year earlier.

Core operating profit in the half decreased 18 per cent due largely to the decrease in turnover and total margin in the supply chain solutions business given the shifting retail environment and customer destocking. Core operating profit in logistics rose 15.1 per cent. Operating costs in supply chain solutions decreased 9.8 per cent, benefiting from the roll out of the digital modules and productivity measures.

Li & Fung is among the top sourcing and supply chain companies in the world. It was affected by a challenging macroeconomic and retail environment in the first half of the year, which saw continued destocking, store closures and bankruptcies.

The strategic divestment of its three product verticals–furniture, beauty and sweaters–was completed in April. The divestment was in line with Li & Fung’s strategy to simplify its business and allow senior management to focus resources on growing the core business of supply chain solutions, helping customers manage the changing retail environment and delivering its three-year plan goals.