Gerry Weber retail revenues climb 36.1% in Q1 FY'13

Based on the national and international expansion of the retail spaces, the Retail segment increased its first-quarter sales by 36.1% from EUR 62.9 to EUR 85.6 million. Against the background of the weak market environment, which was characterized by reduced consumer spending, and the weather-related decline in customer frequency, like-for-like sales were down by 3.4% on the previous year.

A look at the sales trend in the German fashion market shows that the market as a whole reported much higher declines. An independent German trade magazine for the fashion business determined a negative sales trend for November and December 2012 as well as January 2013 between -5% and -9% compared to the respective prior year months.

The Wholesale segment generated sales revenues of EUR 99.3 million, down 2.8% on the first quarter of the previous year. This decline is not only attributable to the weaker market environment but also to a change in segment reporting and the related adjustment of the prior year figures.

Also, the Wholesale revenues for the first three months of the previous year still included the revenues generated by the acquired Dutch Franchise stores. After GERRY WEBER International AG acquired a majority stake in these retail spaces, they now form part of the Retail segment.

At EUR 17.8 million, earnings before interest and taxes (EBIT) in the first quarter of 2012/13 remained almost unchanged from the previous year's EUR 17.7 million. The first three months of the fiscal year 2012/13 were still adversely affected by the effects of the above-average expansion of the Retail segment and the weak market environment. Newly opened retail spaces initially generate a lower sales level than an existing store. This means that the profit contribution of the newly opened retail spaces is initially lower than that of an established store.

In the past fiscal year 2011/12, some 230 Houses of GERRY WEBER and mono-label stores were created as a result of acquisitions and individual store openings as well as 25 formerly franchised Houses of GERRY WEBER were taken over. In the first quarter 2012/13 as scheduled further 20 openings have taken place.  Due to the increased revenue contribution made by the Retail segment, the start of winter sales in January 2013 also had a stronger impact on the operating margin than in the previous years.  Accordingly, the EBIT margin declined from 10.7% from the prior year quarter to 9.6%.