Despite ongoing burdens as a result of the Covid 19 pandemic, the Munich retailer Ludwig Beck was able to return to profitability in the 2021 financial year. As the company announced on Thursday, this was only thanks to government aid payments and other special income.
The Group’s gross sales amounted to EUR 66.0 million in 2021, exceeding the previous year’s level by 9.3 percent. Net sales grew by 7.8 percent to EUR 55.4 million. However, the retailer was “continued to be exposed to the Covid 19 pandemic and its drastic effects on the economy and the consumer behavior of the population,” according to a statement. “With 56 sales lockdown days, the number rose again significantly compared to the previous year with almost 40 days,” explained the company and also referred to “renewed restrictions due to the officially imposed 2G rule” in the Christmas business. The online business developed “only positively”, which “however could not compensate for the drop in sales of the stationary trade”.
Despite these charges, the Group achieved a pre-tax profit of EUR 4.3 million after posting a corresponding loss of EUR 4.3 million in 2020. However, the retailer benefited from one-time income: it received payments of 5.7 million euros as part of Bridging Aid III and earned 2.3 million euros from real estate sales. The bottom line was therefore a net profit of 3.6 million euros. In the previous year, Ludwig Beck posted a deficit of 1.7 million euros.
For the current year, the management is counting on “business to normalize to some extent, with the Oktoberfest taking place again and unrestricted Christmas business with Christmas markets like before the pandemic”. Under these conditions, the company aims to increase gross sales to between EUR 85 and 88 million. It also expects a “slightly positive result before taxes”.
In the event of renewed “restrictions in the inner cities, such as lockdowns, 2G regulations, curfew hours or access restrictions”, it would be “difficult to estimate to what extent Ludwig Beck’s sales and earnings situation will be negatively affected,” warned the retailer.