(Filed Under wholesale Lingerie News). The annual loss (fiscal year May 2019 to April 2020) at Wolford jumped to €27.42 million (about $31.8 million at current exchange rates) up from €11.10 million (about $12.9 million) for the previous year (2018/19).
Annual sales fell 13.6% to €118.5 million in 2019/20 (about $137.6 million), compared to €137.2 million (about $159.3 million) the fiscal year before. The Austria-based firm sells leg wear, bodysuits and underwear, as well as women’s clothing and accessories.
“The strong lock down measures and the restrictions imposed on travel due to the global pandemic had a decisive impact on all luxury sales particularly in the months of March and April 2020, when Wolford´s revenue fell by around 60%,” complained the firm.
Digital sales, however, rose during the lock down. “By the end of April 2020 the company´s online sales exceeded a like for like growth of 41%, the June revenues were even at 54% compared to last year and represent now more than 30% of the total revenue.”
A boost to company finances came at the end of May when it completed the sale of some company property in Bregenz for €72 million (about $83.6 million). “At the same time Wolford repaid all credit lines to its financing banks. Simultaneously, the company repaid the shareholder loan including interests granted by Wolford’s main shareholder Fosun Fashion Investment Holdings (HK) Limited, the firm reported at the time. “This means that our company is now debt-free and also has sufficient funds available to overcome the current crisis and drive forward the further development of the company as planned,” stated COO Andrew Thorndike.
Wolford’s new management team of Thorndike and CCO Silvia Azzali, both of whom assumed their roles in the fall of 2019, have been revamping the company, with steps that include “rightsizing” the “international store portfolio,” as well as “reducing rental payments, optimizing purchasing and procurement, and consistently enhancing efficiency in production and logistics,” according to the company. “One key supplementary measure is the 50% reduction of the time to market. Wolford aims to bring already its next spring/summer collection to the consumer in a significant shortened time frame.”
“Wolford made substantial investments in technology and staff for its online business, extended its distribution channels with additional sales partners, and restructured its design, marketing, and sales teams. Furthermore, the product portfolio has been streamlined, with key foundations being laid to extend the core Wolford brand.”
Looking ahead, the company stated, “the effects of the crisis were still clearly visible in May 2020, with a reduction in revenues of around 50%. This was due mainly to the fact that the reopening dates for individual boutiques varied widely from country to country. The boutiques in Austria, Germany, and Scandinavia were able to gradually reopen in the weeks from mid-April already, while those in France, Italy, Spain, and North America only reopened from the end of May onwards, and in some cases only from the end of June. Wolford plans to return to profitability on an operating level in 2021. —NM
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