Handbag brand Oroton has returned to luxury after 18 months in the wilderness.
Oroton's profit jumped 73 per cent in the half year to January 23 to $3.8 million, a turnaround from a difficult 2014/15 fiscal year.
The company credits its success to higher prices, growing online sales and a luxurious revamp of its stores.
"Oroton has always been an affordable luxury brand," chief executive Mark Newman said.
"But we maybe weren't necessarily behaving in that way a few years back."
Heavy discounting and a loss-making joint venture with Brooks Brothers, which the company exited in July 2015, had dragged down the business.
"We'd become very reliant on clearance activity and discounting and that was something that we recognised we needed to address," Mr Newman said.
The company is now reaping the benefits of improved stores and service, and more products on the expensive end of the spectrum.
"Our best selling handbag this past season was a limited edition bag selling at $1200, but it was twice the price of a normal handbag," Mr Newman said.
The Chinese market's love for expensive brands was also a boost for Oroton's CBD stores, where Chinese tourists account for about 30 per cent of sales, he said.
Mr Newman is confident the company will continue to grow in the second half of the year, and beyond.
But that will require improvements in its Gap clothing business, which continues to run at a loss.
"We are confident over the next six months or so, if we continue to grow the sales ... that business won't be a drag," Mr Newman said.
OROTON'S FOCUS ON LUXURY DELIVERS
* Net profit up 73pct to $3.8m
* Revenue up 12pct to $74.5m
* Fully franked interim dividend up 1.5 cents to 6.0 cents
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