EQS-News

GLOBAL FASHION GROUP REPORTS Q2 2023 RESULTS - Seite 2

 

In LATAM, NMV declined 19.0% yoy. This was a result of our drive for marketing efficiency and lower purchasing power with elevated inflation and interest rates in the region. In SEA, NMV fell 16.9% yoy reflecting our prioritisation of profit over growth in a weaker demand environment. Positive profit contributions from SEA’s growing Marketplace and Platform Services were broadly offset by fixed cost deleverage from lower volumes. In ANZ, steadily increasing interest rates, elevated inflation and GDP growth declines have led to reduced discretionary spend and higher discounting to match a competitive market. As a result, ANZ’s NMV declined by 9.0% yoy.

GFG delivered a Gross Margin of 42.0%, a 1.4ppt decline yoy. This was driven by higher levels of promotional activity particularly in LATAM and ANZ. Gross Margin pressure and fixed cost deleverage led to a lower Adj. EBITDA margin of (7.2)%.

 

Going into 2023, we prepared the business for lower volumes and started the year with less inventory than the year before. As part of GFG’s cost action plans, we reduced inventory levels by 33% (€67.5m reduction in constant currency) and reduced intake by 30% yoy in H1. Managing inventory levels remains a top priority for GFG, along with customer acquisition discipline and restricting overhead and capital investments.

GFG ended Q2 with a strong funding position of €466.7m Pro Forma cash and €173.2m Pro Forma net cash (net of the Convertible Bond and other third-party debt).²

 

Expectations for the full year 2023 are unchanged from the guidance issued in our announcement on 26 July 2023. GFG expects to deliver NMV growth of (15)-(10)%, c.€1.3-1.4 billion in NMV and c.€0.9 billion of Revenue, all on a constant currency basis. Adjusted EBITDA margin is expected to be (8)-(6)%. Capex investment will be c.€30 million.

€m	Q2 2022	Q2 2023	H1 2022	H1 2023
Key Financial Metrics
NMV	436.6	346.5	763.4	649.9
% Constant Currency Growth	(1.9)%	(14.7)%	2.2%	(11.2)%
Revenue	295.6	223.8	517.6	422.3
% Constant Currency Growth	0.8%	(18.6)%	2.8%	(14.9)%
Gross Profit	128.3	94.0	223.3	175.6
% Margin of Revenue	43.4%	42.0%	43.1%	41.6%
EBIT	(63.5)	(35.3)	(92.5)	(75.4)
Adjusted EBITDA	(4.5)	(16.1)	(20.9)	(40.1)
% Margin of Revenue	(1.5)%	(7.2)%	(4.0)%	(9.5)%
Financial Position
Net Working Capital	10.8	21.3	10.8	21.3
Capital Expenditure	10.6	6.8	21.9	14.2
Pro-forma Cash1	561.4	466.7	561.4	466.7
Pro-forma Net Cash1	264.5	173.2	264.5	173.2
Normalised Free Cash Flow[2]	(8.7)	(7.7)	(85.9)	(72.7)