ESCADA targets for fiscal year 2007/2008 adjusted downwards

30 Jun '08

4 min read

ESCADA publishes results for first six months of fiscal year 2007/2008. During the second quarter of fiscal year 2007/2008 (reporting date: October 31) the business performance of ESCADA Group remained below last year's level. This applied in particular to the result of the business unit PRIMERA with the brands apriori, BiBA, cavita, and Laurèl, which are allocated in the fast fashion segment. On view of this development the Board of Management is downgrading its targets for fiscal year 2007/2008, as had already been communicated on June 20, 2008.

Group performance second quarter 2007/2008
- During the course of the second quarter Group sales registered a downturn. In the period February to April 2008 sales totaled 153.7 million Euro, which is 16.1% less than the quarter of last year (183.1 million Euro). Currency-adjusted the decline was -13.5%.

- At 12.5 million Euro earnings before interest, taxes, depreciation and amortization (EBITDA) for the second quarter was 3.5 million Euro down on the comparative figure of the second quarter 2006/2007 (16.0 million Euro). The ESCADA business unit generated an EBITDA of 10.5 million Euro, which is an increase of 6.1% on the same period of last year (9.9 million Euro). Basis for this improved result was a higher share in sales generated in the company-owned retail with the associated positive effect on gross profit, as well as earnings from hedging foreign currency transactions. The PRIMERA business unit generated an EBITDA of 2.0 million Euro (first half year of 2006/2007: 6.1 million Euro).

- The result after taxes reported for the second quarter is negative at -4.3 million Euro (second quarter 2006/2007: 2.4 million Euro).

Group performance first half year 2007/2008
- During the first six months of fiscal year 2007/2008 the ESCADA Group generated sales of 295.8 million Euro, which is 14.1% less than the same period one year ago (344.3 million Euro). Currency adjusted - that is on the basis of constant exchange rates - the minus in sales came to 11.5%.
- The Group's gross profit margin for the first six months came to 65.1%, which is a plus 2.5 percentage points compared with the level recorded the same period the year before (62.6%). This was due to the positive effect from an increasing share of sales generated by the company's own retail.
- The operative costs - personnel expenses plus other operating expenses - totaled 185.2 million Euro for the first six months, which was 1.6 million Euro less than the year before (186.8 million Euro).
- The other operating earnings came to 11.9 million Euro and were thus higher than the earnings one year ago (8.8 million Euro). The increase is essentially the result of higher income generated from the management of foreign currencies.
- For the first half year the ESCADA Group reports an EBITDA of 19.3 million Euro, after a total of 37.6 million Euro for the same period one year before (-48.7%).

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