Tom Tailor Q1 recurring EBITDA ascends 12.1% to €11.1mn

BONITA drives gross profit margin by 870 basis points

The BONITA brand only comprises own retail stores and, since the middle of 2013, e-commerce. As expected, BONITA’s sales declined by 6.3% to EUR 68.4 million in the first quarter of 2014 (2013: EUR 73.0 million). This was primarily attributable to the conscious reduction in sales promotions with a view to strengthen both sales quality and profitability.

TOM TAILOR GROUP looks back on a dynamic first quarter. Group sales increased by 6.0% to EUR 208.7 million in the first three months of the current #

 

The gross profit margin of BONITA thus significantly improved by 870 basis points to 69.3% (2013: 60.6%) in the first quarter – also as a result of the further shift of the brand’s sourcing activities to Asia. BONITA accounted for 32.8% of Group sales (2013: 37.1%). 

 

Considerable rise in gross profit margin boosts earnings 

The Group’s gross profit margin increased by 320 basis points to 56.9% (2013: 53.7%). This positive development was in particular due to the improvement in BONITA’s gross profit margin, the larger retail share and an increase in efficiency in the Company’s sourcing organisation in Asia.

 

Recurring earnings before interest, tax, depreciation and amortisation (EBITDA) increased in the first three months by 12.1% to EUR 11.1 million (2013: EUR 9.9 million). The recurring EBITDA margin came to 5.3% (2013: 5.0%). The reported Group EBITDA went up by 57.1% to EUR 9.9 million (2013: EUR 6.3 million); the reported EBITDA margin climbed as a result to 4.7% (2013: 3.2%).

 

The recurring net result for the period came in at EUR -3.8 million in the first quarter of 2014 (2013: EUR -3.8 million), putting it on a par with the previous year. Recurring earnings per share (EPS) amounted to EUR -0.15(2013: EUR -0.16). The reported net result for the year went up by 22.1% to EUR -6.7 million (2013: EUR -8.6 million). Reported earnings per share amounted to EUR -0.29, up from EUR -0.40 in the previous year.

 

In the first three months of the year, cash flow from operating activities was on a par with the previous year at EUR -11.7 million (2013: EUR -10.9 million), reflecting the build-up of stock at the beginning of the year and the continued expansion. Free cash flow improved by EUR 3.8 million to EUR -17.1 million (2013: EUR -20.9 million) as a result of lower capital expenditure and interest payments.

 

Net debt amounted to EUR 237.6 million and thus remained significantly below the level of the first quarter of 2013 of EUR 270.6 million.

 

Focus on profitable growth 

The Management Board of TOM TAILOR GROUP is looking ahead confidently to the current fiscal year and expects a further sustainable improvement in the quality of sales and earnings at BONITA, as well as continued dynamic growth for the TOM TAILOR brands. The Company will further advance the measures introduced to strengthen its brands, expand the store network in a disciplined manner and apply the successful TOM TAILOR model to BONITA. For the fiscal year 2014, the Group aims at sales of EUR 950 millionand a recurring EBITDA margin of around 10%.