The sales of the clothing group S.Oliver will drop to just under 1 billion euros in the 2020 financial year. The bottom line is that the company is in the red.
In 2019, S.Oliver had a turnover of 1.24 billion euros. After the outbreak of the pandemic, this amount fell by 21 percent to 973.8 million euros. The pandemic and the associated shop closings had a negative impact primarily on the proceeds from S.Oliver’s wholesale business. Here sales fell by 28 percent to 359.8 million euros, while in-house sales only fell by 17 percent to 589.7 million euros.
Restructuring and depreciation of goods weigh on earnings
One-time restructuring costs for the group reorganization and devaluation of goods in the amount of 75 million euros had a negative impact on the operating result. That was minus 60.5 million euros in 2020 compared to 51.6 million euros in the previous year. Without the special effects, the operating result is 15 million euros.
“In view of the corona pandemic, the focus was on the health of employees: inside, securing liquidity and stabilizing business,” said the S.Oliver Group on Tuesday. This was achieved through a significant adjustment to the cost structure. “In this respect, the overall result can also be rated as satisfactory,” continues Rottendorf.
Positive forecast for 2021
The equity ratio of S.Oliver is still over 70 percent and the company continues to provide interest from credit institutions without borrowed capital. “This solid financial structure, which has grown over many years, allows the company to continue making significant investments in the future,” said S.Oliver. This includes the faster development of collections, increased efficiency through digitization and investments in the desirability of brands.
S.Oliver continues to believe in the importance of stationary retail. In the current year, own stores have been opened in prime locations in cities such as Berlin, Munich, Vienna and Salzburg. The company is also continuing its international expansion by opening up new markets in Russia and Serbia. The group employs 5,100 people worldwide.
For 2021, S.Oliver expects “despite several months of lockdowns with a positive operating result.”