Lower fulfilment costs and successful inventory management drive profitability
- Zalando reports improved profitability in Q1
- Adjusted EBIT rose to £24.3m, up from a loss of £600,000
- Lower fulfilment costs and successful inventory management drive profitability
- Gross merchandise volume (GMV) edged up 1.3%
- Group revenue slipped 0.6%
- Zalando confirms full-year guidance
- Expects EBIT to be between £326.2m and £386.3m
- GMV and revenue expected to grow 0% and 5% respectively
- Positive response from customers and partners in Q1
- B2C and B2B growth areas contributing to results
Zalando has reported “improved” profitability during its first quarter as its updated strategy starts to bear fruit. The German fashion giant said adjusted EBIT rose to £24.3m (€28.3m) in the three months, up from a loss of £600,000 (€700,000) for the same period last year. It noted the “substantial improvement” in profitability was driven by lower fulfilment costs and successful inventory management, which contributed to a 1.3% adjusted group EBIT margin. Gross merchandise volume (GMV) edged up 1.3% to £2.8bn (€3.3bn) while group revenue slipped 0.6% to £1.89bn (€2.2bn). Zalando confirmed its full-year guidance for the year and expects EBIT to be between £326.2m and £386.3m (€380m and €450m), and both GMV and revenue to grow 0% and 5% respectively this year. Zalando chief financial officer Dr. Sandra Dembeck said: “As we are executing our ecosystem strategy, we are excited by the positive response from customers and partners in the first quarter. We are returning to growth. B2C customers are showing increased interest in our quality assortment, digital tools, propositions and inspiring content. B2B customers are signing up for our unique offering. Both of our growth vectors are strong and contributing to results, demonstrating the strength of our plans.”
Factuality Level: 8
Factuality Justification: The article provides specific details about Zalando’s financial performance in the first quarter, including adjusted EBIT, GMV, and revenue figures. It also mentions the factors contributing to the improved profitability, such as lower fulfilment costs and successful inventory management. The information is presented in a straightforward manner without sensationalism or bias, making it a reliable source of factual information.
Noise Level: 3
Noise Justification: The article provides relevant information about Zalando’s improved profitability, including key financial figures and the factors contributing to the improvement. It stays on topic and does not dive into unrelated territories. The article supports its claims with data and quotes from Zalando’s chief financial officer. However, it lacks in-depth analysis, accountability, and actionable insights, which prevent it from scoring higher.
Financial Relevance: Yes
Financial Markets Impacted: Zalando’s improved profitability may impact its stock price and investor sentiment.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article discusses Zalando’s improved profitability and its updated strategy, which may have implications for the company’s financial performance and market perception. However, there is no mention of any extreme events or their impact.
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