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Zalando H1 revenues up 31.5 percent, updates FY15 guidance

By Prachi Singh

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Zalando further accelerated its growth momentum in the first half of 2015 by continued focus on customer experience. Group revenues rose by 31.5 percent to 1.38 billion euros (1.53 billion dollars) in the first half of 2015. In the DACH segment, revenue grew by 27.6 percent and in the Rest of Europe segment, revenue grew by 37.8 percent. Revenues in the other segment grew by 27.2 percent. Management now forecasts revenue growth of 28 to 31 percent for the financial year 2015, significantly above the initial 20 to 25 percent guidance.

“Zalando is powering ahead to take full advantage of the great opportunities in European fashion e-commerce. Thanks to our clear focus on customer satisfaction, we have delivered exceptional revenue growth at scale and improving profitability in the first half of 2015,” said Rubin Ritter, Member of the Management Board.

Zalando achieved profitability with an adjusted EBIT of 59.2 million euros (65.8 million dollars), corresponding to an adjusted EBIT margin of 4.3 percent. Adjusted EBIT in the DACH region was a margin of 6.2 percent and the Rest of Europe segment achieved break even with a margin of 1.2 percent. The segment other recorded a margin of 8.5 percent.

In the second quarter of 2015, Zalando revenues were up 34.1 percent. Adjusted EBIT was 30.2 million euros (33.5 million dollars) at group level, corresponding to an EBIT margin of 4.1 percent. Group EBIT was adversely affected by a temporary increase in payment costs. The number of active customers grew strongly to a total of 16.4 million in the second quarter, or by one million additional active customers compared to the first quarter 2015. Visits from mobile devices were up further to 57 percent during the second quarter.

“Much of the retailer’s success has come as a result of rapid expansion into new markets and product diversification with the introduction of clothing. Furthermore, the company has remained focused on Europe, while its competitors set their sights further afield in the US and Asia,” points out Bernadette Kissane, Apparel and Footwear Analyst at Euromonitor International.

To enable continued growth and customer satisfaction, Zalando evolves its warehouse footprint, with the focus on three pillars: The construction of a third self-designed logistics hub in Germany, expanding capacity at the existing warehouse in Monchengladbach to the maximum, as well as piloting the first satellite warehouse in Italy.

Zalando