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Polish retailer Modivo lags Q2 core profit view as online sales fall

Polish retailer Modivo lags Q2 core profit view as online sales fall

- Polish footwear and fashion retailer Modivo MDVP.WA reported a lower-than-expected second-quarter core profit on Friday, as weakness in its main online business offset strong growth in the HalfPrice chain.

Modivo's adjusted earnings before interest, taxes, depreciation and amortisation rose 2% to 390 million zlotys ($104.5 million), missing a median estimate of 407 million zlotys from analysts polled by Reuters.

  • The group is leaning hard on its off-price strategy, having in May unveiled its "ShockPrice" concept targeting heavily price-sensitive customers.

  • Revenue at its established off-price retailer HalfPrice grew 54% to 769 million zlotys in the quarter.

  • Total revenue rose 3% from a year ago, with offline sales jumping 31% and online sales falling 9%.

  • Its core CCC brand recorded a 16% drop in inventory per square meter.

  • However, a growing share of licensed brands across Modivo's business lines boosted like-for-like sales growth and gross margin.

($1 = 3.7323 zlotys)


(Reporting by Marta Maciag, editing by Milla Nissi-Prussak)

((Marta.maciag@thomsonreuters.com))

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