Gerry Weber profit slides in "difficult" Q1
- Q1 profit plummets 88.4% to EUR1.2m
- Sales up 11.1% to EUR 213.7m
Gerry Weber's profit plummeted 88.4% in the quarter
German fashion house Gerry Weber has seen its net profit plummet 88.4% in what it has described as a "difficult" first quarter.
Net income tumbled to EUR1.2m (US$1.3m) during the quarter, compared to EUR10.5m in the same period of the prior year.
Sales revenues increased 11.1% to EUR213.7m, helped by the consolidation of the Hallhuber subsidiary, which contributed EUR50.5m to the group's revenues.
Gerry Weber retail sales were up 3.4% to EUR109.6m from EUR106m last year, while like-for-like sales declined 7.5%. Meanwhile, wholesale sales plummeted 38% to EUR53.6m from EUR86.4m a year ago, due to lower pre-order volumes on the part of the wholesale customers and a shift in deliveries.
"The first quarter of 2015/16 has highlighted the great importance of the 'Fit4Growth' programme we introduced in February," said CEO Ralf Weber.
The initiative, which will see the closure of over 100 stores and the elimination of over 250 jobs, aims to improve revenues, efficiency and costs as well as gross profit, with the main objective of laying the basis for profitable growth in 18 to 24 months. It comprises four elements: optimising retail operations; adjusting structures and processes; strengthening wholesale operations; and modernising the brands.
"We have initiated the individual measures with great determination and are now focusing on the complex tasks," Weber added. "We aim to present the first tangible results to our shareholders, to the public, our employees and business partners on a regularly basis at the upcoming quarterly reporting."
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