Zalando share in red: Zalando achieves targets in 2021 – weaker growth outlook

In the current year, the online marketplace for fashion and cosmetics wants to increase its EBIT and grow significantly more moderately in terms of GMV and sales, but sees itself on course for the medium-term goal of a GMV of more than 30 billion euros in 2025.

Investments in new logistics centers, among other things, should help, which should amount to 400 to 500 million euros in the current year.

CFO David Schrder explained on Tuesday when the figures were presented in Berlin that Zalando would have to react to deteriorating consumer sentiment, disruptions in the supply chain and rising inflation. He expects weaker business growth, especially in the first half of the year. In the second half of the year things should pick up again, he estimates. Another uncertainty factor is the war in Ukraine. Although Zalando is not represented there or in Russia, this is weighing on consumer sentiment in the Eastern European markets, he explained.

The gross goods value (GMV) is expected to increase by 16 to 23 percent to between 16.6 and 17.6 billion euros in 2022.

Sales are expected to grow by 12 to 19 percent to 11.6 to 12.3 billion euros – the Berlin DAX group wants to reach around 20 billion euros in 2025. According to Schrder, Zalando wants to grow faster than the European online fashion trade. Adjusted EBIT is aiming for a range between EUR 430 and 510 million.

According to the company, the forecast does not take into account possible negative influences as a result of the war in Ukraine.

In 2021, Zalando SE increased adjusted EBIT to EUR 468.4 million from EUR 420.8 million and was thus in the targeted upper half of the range of EUR 400 to 475 million. After taxes, Zalando earned EUR 234.5 (226.1) million.

The GMV – ie the total value of the goods sold via the online marketplace including fee income – rose by 34.1 percent to 14.35 billion euros; it was thus in the middle of the target range of 14.0 to 14.6 billion euros.

Sales climbed 29.7 percent to 10.354 billion euros. It was also in the targeted range of 10.1 to 10.5 billion euros.

As in the previous quarter, the trend weakened in the fourth quarter. Sales increased by 20 percent to 3.1 billion euros, adjusted earnings before interest and taxes fell by four percent to 191 million euros. Schrder justified this with higher costs and more discounts that the company gave after stationary retail had opened its doors more and more.

Investors sell Zalando due to weaker growth outlook

The expected weaker growth of the online fashion retailer Zalando in the current year disappointed investors on Tuesday. In the meantime, the Zalando paper has lost 10.14 percent to EUR 53.54 via XETRA.

Meanwhile, JPMorgan analyst Georgina Johanan cautioned that given the uncertain outlook for consumer sentiment, the slightly weaker-than-expected outlook is not surprising.

FRANKFURT (Dow Jones) / BERLIN (dpa-AFX)

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