(Filed Under Financial and General Interest News). Wolford, a majority in stake in which was recently acquired by a Chinese conglomerate, halved its losses for the first nine months of its fiscal year.
The firm lost 2.57 million euros (m€) (about $3 million at current exchange rates) on sales of 119.36 m€ (about $145 million) for the period May 2017 to January 2018. This compares to a loss of 5.08 m€ (about $6 million) on sales of 119.05 m€ in the same period the year before.
The public company, which is listed on the Vienna Stock Exchange, has posted other big losses in recent years, including 10.66 m€ in its 2015/16 fiscal year, and 17.88 m€ (about $22 million) in fiscal 2016/2017. The firm wholesales and retails bodywear, underwear and swimwear for women as well as legwear for women and men.
Fosun, a Chinese public company, announced a deal in March to pay 33 m€ (about $40 million) for a 50.9% stake in Wolford, as well as providing up to 22 m€ in capital. It also said it wanted to buy out the remaining shareholders. Among its other investments, Fosun has a majority stake in Lanvin and a position in St. John Knits.
In reporting the results for the nine months, the company explained, “Wolford’s own retail business generated a revenue increase of 1.7% or € 1.29 million in the first nine months compared to the previous year. On a like-for-like basis, the increase actually equaled 3.7%. In contrast, Wolford’s wholesale business reported a revenue decrease of 4.4% or € 1.93 million, comprising a 2.7% decline when adjusted for currency effects. Revenue of Wolford’s own online business was up significantly once again by 20.6% year-on-year, comprising a rise of € 2.09 million.”
“Revenue development in the regions showed a very mixed picture in the first nine months of the 2017/18 financial year. Wolford succeeded in clearly increasing revenue in Austria (+4.8%), Italy (+2.1%), Spain (+5%), the Netherlands (+4.9%) and Belgium (+3.3%), mainly as a result of the growing retail business. Wolford’s business in Eastern Europe performed particularly well, expanding by 37.3%, which is primarily attributable to the recovery of the Russian market and the expansion of the commercial relationship with the most important Russian wholesale partner. In contrast, revenue declined in the U.S. (-1.7%) and Great Britain (-8.7%), above all due to the decline in value of the British pound and the U.S. dollar. The retail business could not compensate for the reduction in wholesale revenue in Germany (-2.2%), Switzerland (-6.7%) and France (-3.0%).”
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