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Zalando expecting significant revenue growth

Oct 16, 2015 Germany
Zalando expecting significant revenue growth
Europe’s leading online platform for fashion products has announced continued growth for group revenue in the third quarter of 2015. Preliminary figures indicate growth above 40%
Revenue for the third quarter should be in the region of 707-717 million euros, growing by 41-43 %, compared to quarter three in 2014 - 501 million euros, according to preliminary figures.

In the first nine months of 2015 Zalando achieved revenues of 2.084-2.094 million euros, growing by around 35% (compares to 1.548 million euros in the first nine months 2014).

Rubin Ritter, Member of the Management Board, stated: “The results are in line with our strategy to invest into long-term growth. In the third quarter we saw unique growth opportunities to significantly beat our growth targets and tapped into these with full conviction. We remain committed to our profitable growth path, but are willing to trade in some profitability to accelerate our growth and gain market share.”

Zalando continued to invest in its customer proposition in the third quarter, driving revenue growth significantly above expectations at the expense of margin. While gross margin was in line with the prior year, profitability was mainly impacted by higher fulfillment costs (related to investments in the customer experience are and with significant technology investments to further drive Zalando’s mobile and platform strategies) and marketing costs driven by increased investments into app downloads plus an earlier fall-winter season start campaign compared to last year.

Following these strong results in the first nine months of the year, Zalando is now expecting to substantially exceed its initial 2015 revenue growth forecast of 20%-25% and revised guidance of 28%-31% and is increasing its guidance to 33%-35%. As a result of additional growth investments, guidance for 2015 adjusted EBIT margin is lowered to 3%-4%.

All figures reported by Zalando are preliminary and unreviewed.

Zalando is Europe’s leading online fashion platform for women, men and children. Offering roughly 1 500 international brands ranges from popular global brands, fast fashion and local brands, the portfolio is complemented by private label products. Available in 15 European markets (Austria, Belgium, Denmark, Finland, France, Germany, Italy, Luxembourg, the Netherlands, Norway, Spain, Sweden, Switzerland, Poland and the United Kingdom), the company has a logistics network that includes three centrally located fulfillment centers in Germany.

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