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Chinese beauty retailer Jumei reports earnings loss; stock buyback lifts shares

Counterfeit goods remain a threat to the Chinese company's success
Applying makeup
Shares jumped in pre-market trading

Jumei International Holding Limited (NYSE:JMEI) announced its annual report for 2017 as well as a share repurchasing plan early Monday.

The Chinese beauty products retailer reported an earnings loss of US$0.04 per share on revenue of US$894mln compared with US$0.14 EPS on revenue of $904mln.

The company’s e-commerce site offers beauty products for women, men, and children as well as health supplements.

Listed among Jumei’s risks was the threat of counterfeit products. In 2014, tech news outlet tech.qq reported that the retailer sold fake luxury goods, including watches and clothing from high-end brands like Armani and Burberry.

Products sold on the site are sourced by suppliers and third-party merchants, according to a company statement.

“Although we have adopted measures to verify the authenticity of products sold on our internet platform and to immediately remove any counterfeit products found on our internet platform, these measures may not always be successful,” the company said in a statement.

The Beijing-based company’s board of directors has authorized a stock buyback of up to US$100mln of its shares over the next year.

Shares of the company jumped more than 10% in Monday pre-market trading.

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