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Sales hurt by negative currency effects, Charles Vögele

30 Aug '10
5 min read

processes and double the rhythm of collection release.
3. Optimize expansion: exploit potential in the main markets, improve locations and
floorspace productivity, close unprofitable stores.

1. Measures to improve the image
During the half-year under review, various measures were taken to make the company's marketing more emotional: Charles Vögele is about to launch its own lingerie and underwear collection, the new store design has been introduced successfully, and two international stars, Penélope and Mónica Cruz have become brand ambassadors. In addition, the company is now the title sponsor of Charles Vögele Fashion Days Zurich.

2. Verticalization measures
The merchandise organization has been split into three areas: Brand Management, Merchandise Management and Sourcing. The teams have been strengthened by the addition of international specialists. Thanks to faster and more efficient processes, the frequency of new collections can be doubled from 4 to 8 a year. Logistics are being centralized in stages up to the end of 2012 in order to ensure efficient distribution. The sales markets have been divided into four regions: Switzerland, Germany, CEE (Austria, Slovenia, Hungary, Czech Republic and Poland), and Benelux.

3. Expansion measures
A top priority during the half-year under review was to streamline the store portfolio. Further locations will be optimized by the end of this year in order to increase floorspace productivity. From 2011 onwards, expansion activities will be accelerated in the main markets of Switzerland, Southern and Western Germany and Austria.

Changes in the 1st and 2nd tiers of management
The Board of Directors has appointed Frank Beeck as the new Chief Sales Officer. In his function as Member of Group Management he has been responsible since July 2010 for managing all sales channels. The second tier of management has also been strengthened by the addition of e-commerce, visual merchandising, sourcing and marketing experts with extensive industry knowledge.

Outlook
Changes in organizational and process structures are well underway and will continue until 2012. In the transition phase the measures introduced will have a positive effect mainly on costs. Owing to the current streamlining of the portfolio and adjustments to the company's image, improvements on the earnings side will only become evident in the medium term.

The first signs of recovery on sales markets are appearing. However, the market environment remains difficult. The situation is made even harder by unfavourable exchange rates, especially in the euro zone. The situation in the Asian procurement markets is also unstable. A positive net result is expected for the year as a whole, and an EBITDA margin of 10% is expected in the medium term.

Charles Vögele Group is one of Europe's leading vertical fashion companies. It offers the latest fashions at great prices to people in the prime of their lives who want to feel good. With attractively presented goods, combined with friendly, knowledgeable advice, it creates a relaxed and enjoyable shopping experience. Charles Vögele has branches in nine countries: Switzerland, Germany, Austria, Slovenia, the Netherlands, Belgium, Hungary, the Czech Republic and Poland.

Charles Vögele Group

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