About You revises outlook on slow business recovery

European fashion platform About You Holding SE has adjusted its outlook owing to declining consumer sentiment and a deterioration in macroeconomic factors that are expected to have a stronger and more prolonged adverse impact on top- and bottom-line developments.

For the second quarter, the management board expects an increase in revenue of 4.9 percent to 12.5 percent to between 415 to 445 million euros and an adjusted EBITDA in the range of negative 55 to negative 40 million euros corresponding to an adjusted EBITDA margin of negative 13.3 percent to negative 9 percent.

The company said in a release that the revenue growth has moderately slowed down in the course of Q2 2022/2023 and is below the board's previous expectation.

Commenting on the outlook, Hannes Wiese, co-founder and co-CEO of About You, said: "We expected a stabilisation of the macro-environment and a business recovery from the second quarter onwards. Our inventories and cost structures were planned accordingly, which puts a strain on profitability now that revenue growth is lower than expected. Reaching adjusted EBITDA break-even for the group remains our top priority for FY 2023/2024 and we reiterate our forecast to achieve this, despite current challenges."

The company added that led by the tense market environment, management now expects revenue growth in the second half of the fiscal year to be broadly in line with H1 2022/2023, despite a lower comparison base from H2 2021/2022.

For the second half of the financial year, a slight improvement in adjusted EBITDA and the adjusted EBITDA margin is expected compared to H1 2022/2023 mainly driven by a structurally higher profitability in the autumn/winter season, due to higher-ticket items. The bottom-line however remains under pressure due to the revised revenue expectation and surging cost inflation.

"Currently, the cost structure is being adjusted to the market conditions. We continue to expect our group to break-even on adjusted EBITDA level in the next financial year. About You is uniquely positioned and I am convinced that we will generate long-term value for our shareholders with our inspiring and personalised business model. Based on this belief, I already increased my stake in the company in July," added Tarek Müller, co-founder and co-CEO of About You.

The company’s half-year financial report will be published on October 11, 2022.