Zalando Q1 FY20 sales jump 10.6% to €1,524 million

11 May '20

2 min read

Pic: Zalando

Zalando, an online platform for fashion and lifestyle, has reported 10.6 per cent sales growth to €1,524.2 million in first quarter (Q1) FY20 ended on March 31, 2020 compared to sales of €1,378.2 million in same period prior year. Gross profit during the quarter were €538.0 million (Q1 FY19: €549.5 million). Net income reported a loss of €86.4 million.

The company reported that the performance in the first quarter was below its expectations due to effects of the coronavirus crisis. After strong growth in January and February this year, the company saw a significant decrease in consumer demand as a consequence of social distancing measures imposed by governments across Europe.

In Q1 FY20, Zalando increased GMV (Gross Merchandise Value) to €242.3 million (Q1 FY19: €1,99.2 million). While the first two months of FY20 showed strong GMV growth, this metric was severely impacted in March as Covid-19 continued to spread across Europe coupled with mitigation measures imposed by governments and their negative impact on consumer spending, as company reported.

Fashion store segment reported 9.7 per cent increase in sales to €1,391.6 million (Q1 FY19: €1,268.5 million). Offprice segment sales jumped 35.1 per cent to €37.4 million (Q1 FY19: €136.8 million).

The revenue increase in the Fashion Store was reportedly due to solid growth in active customers and average orders per active customer.

Zalando also reported that its full year outlook FY20 has been changed. Zalando had explicitly excluded the effects of the coronavirus crisis in the guidance published earlier. Due to the increasing spread of the virus in Europe and the yet unpredictable effects of the coronavirus crisis, Zalando has withdrawn its guidance on March 30, 2020.

In the now updated outlook, Zalando expects GMV and revenue growth between 10-20 per cent for FY20, whereby revenue growth will be slightly below that of GMV.

Fibre2Fashion News Desk (JL)

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