The days of double-digit sales growth for Europe’s largest fashion portal are over.
(Photo: dpa)
Berlin, Dusseldorf The years of rapid growth are over for Zalando. Last year, the turnover of Europe’s largest fashion portal fell by 0.1 percent to 10.3 billion euros. At EUR 14.8 billion, the gross value of goods grew by three percent, at the lower end of the forecast of EUR 14.8 to 15.3 billion, which was lowered in the summer.
In 2021, Zalando had reported an increase in sales of almost 30 percent. However, the slump in consumption, also as a result of high inflation, and the desire of many consumers to go shopping in stationary retail again, are now making business more difficult. For the current year, the Dax group expects the gross goods value (GMV) to increase by one to seven percent. Zalando estimates the revenue development at minus one to plus four percent.
Adjusted earnings before interest and taxes amounted to 185 million euros – and were thus significantly below the previous year’s figure of 468 million euros. The net profit also fell significantly from 234.5 to 16.8 million euros. In the current year it should then be enough for earnings before interest and taxes between 280 and 350 million euros.
“Our long-term goals remain unchanged,” said co-CEO and company founder Robert Gentz. “We remain confident that we will return to double-digit gross merchandise volume growth in the medium term by continuing to execute on our vision and strategy, eventually serving 10% of the €450 billion European fashion market.”
However, the announcement no longer mentions the previously announced goal of increasing the gross value of goods to 30 billion euros by 2025. All the company says now is that it will be near the top end of its margin target of 3% to 6% by 2025, and will reach double-digit margins over the long term. Meanwhile, the number of active customers has risen to more than 51 million. The average value of the shopping basket fell by ten cents to EUR 56.70 in 2022
Just a few weeks ago, the Berlin Dax group announced the first major downsizing since the company was founded. Several hundred of the currently more than 16,000 jobs are to be eliminated. So far, little is known about the cuts, which is causing concern in the company. In the meantime, however, talks with the works council are said to have started.
>> Read about this: Job cuts at Zalando cause great unrest
At the height of the corona pandemic, Zalando hired thousands of new employees. The company is now to be streamlined and structures streamlined. This should also reduce costs.
Despite the lower growth rates, according to the industry association HDE, the trend towards online is not abating. “Online trade remains the growth driver for the entire industry,” said HDE President Alexander von Preen.
The share price initially fell on the stock exchange, but then recovered significantly and rose by five percent to over 41 euros.
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