The clothing group Gerry Weber International AG had to accept a decline in sales in the 2021 financial year, but was able to significantly improve its earnings and return to the profit zone. In the first three months of the current year, the group of companies, which owns the brands Gerry Weber, Taifun and Samoon, benefited from the easing of protective measures against the Covid 19 pandemic. This is the result of current figures published on Monday.
According to this, group sales last year amounted to 262.7 million euros. Compared to 2020, this means a decrease of 5.5 percent. The company announced that the proceeds had “reached the lower end of the range forecast for 2021”. “In addition to the temporary closures and access restrictions for stationary retail ordered to combat the corona pandemic, the gloomy consumer mood, falling frequencies and disruptions in the global supply chains” contributed to the negative sales development.
Due to the “comparatively long-lasting corona-related restrictions in German retail”, sales on the home market shrank by 13.6 percent to 129.1 million euros. Revenues abroad, on the other hand, rose by 3.9 percent to EUR 133.6 million and, at 50.9 percent, accounted for slightly more than half of total sales. In the Gerry Weber Retail segment, which includes over-the-counter retail, sales fell by a total of 2.8 percent to EUR 123.3 million, and in the wholesale business by as much as 15.6 percent to EUR 94.9 million. On the other hand, there was an upward trend in the company’s own e-commerce, whose revenues increased by 29.5 percent to 42.1 million euros.
CEO Angelika Schindler-Obenhaus “incredibly proud” of annual profit
Gerry Weber was able to improve the result significantly. This was due to austerity measures, but also because the group booked state aid of 28.3 million euros as part of Bridging Aid III. The reported earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to 63.2 million euros, after a deficit of 2.4 million euros had been reported on this basis in the previous year. The normalized – i.e. adjusted for the effects of the IFRS 16 accounting standard – EBITDA reached a level of EUR 28.8 million. In 2020 it was -39.7 million euros. Even without the special income from the bridging aid, the result exceeded the Group’s expectations. The bottom line was a reported net profit of 23.0 million euros. The clothing supplier closed the previous year with a loss of EUR 86.0 million.
CEO Angelika Schindler-Obenhaus was satisfied: “We are incredibly proud of our entire team worldwide because Gerry Weber is back in the black. This is a really great result for us – and in view of all the challenges worldwide, it was certainly not foreseeable,” she said at the digital balance sheet press conference on Monday.
In the first quarter of 2022, sales will increase by over sixty percent
In the first quarter of the current year, group sales rose by 60.6 percent to EUR 72.9 million compared to the same period of the previous year. The group benefited from the fact that, unlike in the first three months of last year, the shops were open all the time. Nevertheless, the sales development was “influenced, among other things, by ongoing restrictions for stationary retail as a result of the corona pandemic and by the generally subdued consumer mood,” the company explained.
Even without aid, the clothing supplier remained operationally profitable: The normalized EBITDA was 1.7 million euros. “In the current situation, this is a bomb result,” emphasized Chief Financial Officer (CFO) Florian Frank at the balance sheet press conference. In the same period of the previous year, this indicator was still negative (-3.5 million euros). The group was able to reduce its loss for the period from 10.9 to 5.2 million euros.
The forecasts are more cautious
In view of the continuing uncertainties regarding the further development of the corona pandemic, the difficult economic conditions and the expected consequences of the Ukraine war, which had not yet been taken into account in the outlook, the Group lowered its forecast for the full financial year.
Annual sales are now expected to be in the range of EUR 310 to 335 million, after the previous target range of EUR 360 to 390 million. In terms of normalized EBITDA, management is now anticipating a value “in the negative low single-digit million euro range”. So far, on this basis, it had promised a positive result “in the low double-digit million range”.