Zalando posts improved EBIT despite revenue decline
Zalando has posted a 72% increase in adjusted group EBIT to €23.2 million following reduced logistics costs in its third quarter.
However, revenue and gross merchandise volume at the online fashion retailer fell by 3.2% and 2.4% respectively amid a challenging macroeconomic environment of low consumer sentiment and declining online sales. The company was also impacted by the warmest September on record in Europe, which meant customers put off buying autumn clothing.
Zalando is currently laying the foundations for future growth as it looks to inspire customers with new content and storytelling formats, as well as a new luxury boutique-style space in its online fashion store to improve the experience for designer brands and customers.
In addition, the company has recently launched the B2B brand ZEOS (Zalando Ecommerce Operating System) to enable brands and retailers to manage their multichannel business across Europe within one unified platform.
Sandra Dembeck, Zalando chief financial officer, said: “Storytelling, logistics and technology are key to boost our future growth. Our healthy balance sheet gives us the financial flexibility to make these strategic investments. On top of that, our financial discipline meant that we were able to deliver on another quarter of improved profitability.”
Zalando still expects adjusted EBIT to come in at between €300 million and €350 million in its 2023 financial year. Meanwhile, revenue is expected to fall by between 0.5% and 3% compared to the lower half of the previous guidance ranges of -1% to 4%.
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