Tom Tailor preliminary nine months sales up 3.5 percent

REPORT_ Announcing its preliminary figures for the first nine months of fiscal 2014, Tom Tailor Group

said that it continued to increase its sales and earnings during the period. According to preliminary information, the Group increased sales by 3.5 percent to 679.1 million euros (870.6 million dollars) during the first nine months primarily driven by the Tom Tailor brand.

The recurring Group earnings before EBITDA rose by 20.7 percent during the period under review. The EBITDA margin increased to 8.4 percent compared to 7.2 percent last year. A number of factors contributed to improved profitability including the consistent focus on profitable sales at Bonita as well as growing sales volumes in the own purchasing company.

“Tom Tailor has performed comparatively well over recent months. The third quarter was disappointing for the entire clothing retail industry due to the extreme temperatures in July and particularly in September. For Tom Tailor Group, sales quality and improvement in earnings are priorities this year. The significant increase in recurring EBITDA demonstrates that our focus has paid off. It is also underlined by the development of the gross profit margin of Bonita which has significantly improved over the nine month period. The performance during the fourth quarter is now an important factor for us,” opined Dieter Holzer, Chief Executive Officer of Tom Tailor Holding.

The Tom Tailor brand increased sales in the first nine months through its retail and wholesale activities by 9 percent and the adjusted EBITDA rose by 23.1 percent as well as the adjusted EBITDA margin went up from 8.6 percent to 9.7 percent. Tom Tailor Retail, which includes sales through Tom Tailor stores and E-commerce, increased sales in the nine-month period by 7.8 percent. On a like-for-like basis the segment increased sales by 1.2 percent. The adjusted EBITDA rose by 19.4 percent and the adjusted EBITDA margin of improved to 6.3 percent.

Group’s wholesale continued its dynamic growth path and increased sales by 9.9 percent. Despite the difficult conditions with unseasonable weather, the segment underwent a strong sales increase of 12.8 percent, with adjusted EBITDA reaching 30.6 million euros (39.1 million dollars). The adjusted EBITDA margin rose from 10.8 percent in the prior year-period to 12.3 percent.

In the current fiscal year the Bonita brand is focusing on sharpening its product and brand profile as well as on improving sales quality. Promotions were therefore consequently scaled back. Sales thus declined by 5.1 percent and on a like-for-like basis, sales came down by 8.8 percent. Conversely, the focus on sales quality was reflected positively in the development of the gross profit margin. It improved during the first nine months by 4.9 percent points to 67 percent. The adjusted EBITDA increased by 14.1 percent and adjusted EBITDA margin amounted to 6 percent.

Tom Tailor Group will publish the complete results for the first nine months of 2014 on November 6, 2014.