The e-commerce group Global Fashion Group SA (GFG) lowered its annual forecasts once again on Thursday evening. The online fashion retailer cited the cessation of business activities in Argentina and the weakening global demand trend as reasons.
The parent company of the platforms Dafiti, Zalora and The Iconic now expects a currency-adjusted decline in net merchandise volume (NMV) of 16 to 18 percent to 1.2 to 1.3 billion euros in 2023. Previously, only a decline of ten to 15 percent was expected. The sales forecast was lowered from 0.9 to 0.8 billion euros.
Management is now also more cautious about the prospects for earnings before interest, taxes, depreciation and amortization (EBITDA) adjusted for special effects. It now expects an adjusted EBITDA margin in the range of -7 to -9 percent for the full year. Previously -6 to -8 percent had been forecast.
In addition to the recently decided withdrawal from Argentina, which was justified by the “difficult macroeconomic environment”, the recent weak business development also prompted management to lower its forecasts.
According to preliminary figures, GMV fell 19 percent on a currency-neutral basis in the third quarter. Sales therefore fell even further short of the previous year’s level (-25 percent adjusted for currency effects). The adjusted EBITDA margin was therefore -10 percent.