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Zalando nearly doubles adjusted EBIT in second quarter

Zalando almost doubled its adjusted EBIT in its second quarter with an uplift of 87% to €144.8 million year-on-year. The retailer attributed the uplift to more… View Article

FASHION RETAIL NEWS UK

Zalando nearly doubles adjusted EBIT in second quarter

Zalando almost doubled its adjusted EBIT in its second quarter with an uplift of 87% to €144.8 million year-on-year.

The retailer attributed the uplift to more focused marketing, better order economics, and bigger average basket sizes, which resulted in lower fulfillment costs.

Sandra Dembeck, Zalando’s chief financial officer, said: “Amid the temporarily challenging retail environment, we continue to drive sustainable efficiencies in fulfillment and marketing. These efforts have paid off this year with adjusted EBIT almost doubling in the second quarter. Such success puts us in pole position to shift our focus more towards investment and future growth initiatives.”

However, the retailer’s gross merchandise volume fell by 1.8% to €3.7 billion in the period. Revenue was also down, dropping by 2.5% to €2.6 billion.

Zalando said its partners are continuing to grow their businesses on its platform with more choosing to use its fulfillment service offering. The partner business share of fashion store gross merchandise volume rose by almost 7% in the period while the share of items shipped by Zalando Fulfillment Solutions increased by 3% on the corresponding period last year.

Last month, Zalando launched a  new artificial-intelligence tool which allows customers in Germany, Austria and Switzerland to receive size recommendations for selected garments, based on their unique body measurements.

Robert Gentz, co-chief executive of Zalando, said: “We are investing in areas such as storytelling and technology that will boost future growth. New brands such as Lululemon and Lancôme will excite our customers and help make Zalando even more a destination of choice.

“Our new size and fit tool will make the shopping experience even better. This tool is a step change solution in the industry that will help customers find the perfect fit before delivery. This is truly exciting as it shows how one of the core challenges in fashion ecommerce can be solved at scale.”

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