Hallhuber drives Gerry Weber towards recovery, CEO upbeat despite profits dip
Is Gerry Weber about to turn a corner? The company that has been struggling with weak results saw core nine-month sales dropping just 2.9% it said Thursday, which isn’t bad in the context of earlier results.
It was boosted by its Hallhuber brand doing better and also said that its Fit4Growth strategic programme has now been implemented “almost in full”. That means it has seen comp sales revenues rising ahead of overall market growth and it has also been seeing the benefit of cost savings.
That said, it’s not all rosy just yet as a big reduction in inventories is still denting its operating results.
And that dent was significant. Group profit on an Ebitda basis fell to €35 million from €40.7 million, although group Ebit was €0.2 million, not that far behind the prior year period’s €0.6 million.
Consolidated sales fell by almost 3% to €620 million for the group as a whole, but with 88 fewer points of sale as part of its closure programme, that was only to be expected.
The firm’s core brands (Gerry Weber, Taifun and Samoon) contributed €479.4m to group revenues, down from €504.8m, but, as mentioned, the Hallhuber unit went from strength to strength. Its sales were up 5.3% to €140.8 million on the back of a Q3 leap of 14%. Its sales had dropped 0.9% in Q1 but clearly picked up as the financial year wore on with Q2 up 4.1%.
The company, which is big internationally but still has Germany as its core market, said the wider German fashion sector fell 3.3% but Gerry Weber fell only 2.5% on a comps basis.
And wholesale revenues fell 2% to €187.5 million, despite the “continued difficult market environment”.
While the company's margins declined, CEO Ralf Weber was upbeat and said “the first positive effects can be felt on the cost side and with regard to sales revenues.”
For the year, sales revenues should fall between 2% and 4% from the prior year’s €900.8m, due to store closures.
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