Global Fashion SA logo

GFG - Global Fashion SA News Story

€6.25 0.4  7.4%

Last Trade - 4:35pm

Sector
Consumer Cyclicals
Size
Mid Cap
Market Cap £930.5m
Enterprise Value £773.1m
Revenue £1.22bn
Position in Universe 366th / 1039

Global Fashion Group says it is making progress towards profit

Wed 21st August, 2019 8:45am
BERLIN, Aug 21 (Reuters) - Global Fashion Group (GFG)
 GFG.DE , the online fashion retailer focused on emerging
markets, said it is working hard to reduce its losses as it
reported second-quarter sales rose a currency-adjusted 16.5%.
    Shares in GFG, which runs fashion websites in Russia, Latin
America and south-east Asia and which listed on the Frankfurt
stock exchange last month, rose 4%.
    GFG said it was making progress towards break-even on its
adjusted earnings before interest, taxation, depreciation and
amortisation (EBITDA), after its loss ticked up to 3.2 million
euro ($3.55 million) in the second quarter.
    "We are well on track," co-chief executive Christoph
Barchewitz told journalists, noting that the company had already
reached profitability in Latin America and Australia in 2018,
but it would take more time in south-east Asia.
    Revenue came in at 343 million euros, while net merchandise
value - the value of products ordered on the GFG marketplace -
rose 22.7% on a constant currency basis to 449 million euros.
    GFG, set up by Sweden's Kinnevik  KINVb.ST  and Germany's
Rocket Internet  RKET.DE , trimmed its forecast for 2019 capital
expenditure to 80 million euros from a previous 90-95 million
euros as it shifted some spending on a new warehouse in Brazil
to 2020.
    Barchewitz said he was not too concerned about a 2.2% fall
in average order value to 50.5 euros, saying it was more
important to focus on order frequency, which was up 8.8%.
    "There is certainly a tradeoff between frequency and average
order value," he said, but added: "The economic model is working
at these order values."
    Europe's biggest online fashion site Zalando  ZALG.DE , on
which GFG was modelled, has also seen a fall in average order
value as customers shop more frequently from their smartphones,
but buy less each time, denting its profitability.
($1 = 0.9018 euros)

 (Reporting by Emma Thomasson
Editing by Michelle Martin)
 ((+49 30 2888 5081; Reuters Messaging:
emma.thomasson.thomsonreuters.com@reuters.net))
© Stockopedia 2020, Refinitiv, Share Data Services.
This site cannot substitute for professional investment advice or independent factual verification. To use it, you must accept our Terms of Use, Privacy and Disclaimer policies.