DGAP-News: TOM TAILOR GROUP separates from its troubled past and lays foundation for the future
DGAP-News: TOM TAILOR Holding AG / Key word(s): Preliminary Results
TOM TAILOR GROUP separates from its troubled past and lays foundation for the future
21.02.2017 / 20:03
The issuer is solely responsible for the content of this announcement.
TOM TAILOR GROUP separates from its troubled past and lays foundation for the future
Preliminary figures for the fiscal year 2016
- Forecast achieved: sales increase by 1.3 percent to EUR 968.5 million and Group EBITDA at EUR 10.3 million
- Net result for the year including the RESET measures in line with expectations negative at around EUR 73 million (preliminary)
- Fourth quarter of 2016 shows first effects for stabilizing earnings
- Net debt and inventories both reduced by EUR 44.3 million compared with 30 June 2016
- TOM TAILOR brand increases sales by 5.6 percent to EUR 665.6 million
Hamburg, 21 February 2017. The TOM TAILOR GROUP has achieved its forecast for the fiscal year 2016 with a Group EBITDA amounting to EUR 10.3 million and an increase in sales of 1.3 percent to EUR 968.5 million. Furthermore, the company has realized the first positive effects from the RESET cost-reduction and efficiency program. In line with expectations, the loss for the year amounts to around EUR 73 million pre-audit. This result includes one-off expenses amounting to EUR 80.9 million for the RESET measures.
Realignment proceeds
The cost and process optimization program launched by the new Executive Board in October 2016 is progressing well and is beginning to have a positive impact. The objective is to focus the Group on its healthy core business and to consistently discontinue all unprofitable business operations.
As a result, during the fourth quarter of 2016, the Group pulled back business from South Africa and either started or already completed around 250 of approximately 300 planned branch closures. Additionally, the brands TOM TAILOR POLO TEAM and TOM TAILOR Contemporary were discontinued and, in the summer of 2017, the BONITA Men brand will also be taken out of the market. Furthermore, BONITA successfully implemented a tight cost management and thereby further reduced its cost base by nearly 10 percent. In 2017, the Group will also withdraw from China, the USA, and largely from France.
"We are gradually shedding ourselves of the troubled past. This was associated with financial cuts in 2016, but we have already emerged out of the trough. The first positive impacts have already become tangible in the fourth quarter. This is evidenced by the slight improvement of the gross profit margin at TOM TAILOR and BONITA, and the adjusted cost structure," explained Dr Heiko Schäfer, interim CEO and COO of TOM TAILOR Holding AG. "During the current fiscal year 2017, we will complete the remaining clean-up work and look with confidence to the future. Ultimately, we have excellent employees, long-time customer relationships and attractive brands."
The umbrella brand TOM TAILOR achieved growth of 5.6 percent to EUR 665.6 million (previous year: EUR 630.0 million) with sales through its own stores and wholesale partners. The umbrella brand BONITA contributed EUR 303.0 million to Group sales after EUR 325.8 million in the previous year. Here it became evident that the new collection style has generated a good level of acceptance. This is already reflected in an increased gross profit margin of more than 70 percent in the fourth quarter.
Net debt and inventories significantly reduced
Since June 2016, the TOM TAILOR GROUP has succeeded in significantly reducing its level of net debt by EUR 44.3 million to EUR 194.7 million. The successful capital increase carried out in December 2016 generated proceeds of EUR 12.5 million and enabled the company to pay off a part of its maturing promissory note loans.
The company also selectively withdrew old stocks with no impact on income, and thereby reduced its inventories by EUR 44.3 million to EUR 159.1 million compared with 30 June 2016. This substantially improved working capital.
The balance sheet was reduced from EUR 781.5 million (status: 30 June 2016) to EUR 695.7 million.
"Over the past few months, we have been driving our RESET program with great intensity and have now achieved the first tangible successes. This program has yielded a number of positive benefits including an improvement of the working capital, and we are getting closer to our overarching goal of getting the company out of debt," summarized Thomas Dressendörfer, CFO of TOM TAILOR Holding. "In 2017, we will complete the program and stabilize our core business. We will then devote our attention to developing strategic, profitable, growth opportunities."
In parallel, the company is investing selectively in its brands TOM TAILOR, TOM TAILOR Denim, Kids and BONITA in order to sharpen their profiles and enhance their appeal. Furthermore, the company will continue to expand its omnichannel sales approach and its own e-shop in the growing digital market, so as to strengthen the competitiveness. Another key module of its foundation for the future is provided by the harmonization and modernization of the Group's IT landscape, in particular by the planned introduction of SAP.
Diary dates
On 28 March 2017, the TOM TAILOR GROUP will present the audited Annual Report 2016 and the forecast for the current fiscal year 2017.
About TOM TAILOR GROUP
TOM TAILOR GROUP is an international, vertically aligned fashion and lifestyle company that focusses on so called Casual Wear offered in the medium price segment. The product portfolio is complemented by a broad range of fashionable accessories. With its umbrella brands TOM TAILOR and BONITA, the Group addresses various segments of the fashion market.
The TOM TAILOR brand is marketed through the retail and wholesale segments, and thus through single-label stores as well as wholesale partners. At the end of 2016, these comprised 472 TOM TAILOR stores and 205 franchise stores, 3,050 shop-in-shops and around 8,400 multi-label points of sale. The brand is present in more than 35 countries.
BONITA has 950 retail stores as well as 50 shop-in-shop spaces.
The collections of both brands are also available through their respective online shops.
Further information is also available at www.tom-tailor-group.com and www.Bonita.eu
Media and investor contact
Felix Zander
Head of Investor Relations & Corporate Communications
TOM TAILOR GROUP
Phone: +49 (0) 40 58956-449
Email: felix.zander@tom-tailor.com
Lena Christin Wulfmeyer
Senior Manager Corporate Communications
TOM TAILOR GROUP
Phone: +49 (0) 40 58956-420
Email: lena.wulfmeyer@tom-tailor.com
21.02.2017 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de
Language:
English
Company:
TOM TAILOR Holding AG
Garstedter Weg 14
22453 Hamburg
Germany
Phone:
+49 (0) 40 589 56 0
Fax:
+49 (0) 40 589 56 398
E-mail:
info@tom-tailor.com
Internet:
www.tom-tailor-group.com
ISIN:
DE000A0STST2
WKN:
A0STST
Listed:
Regulated Market in Frankfurt (Prime Standard), Hamburg; Regulated Unofficial Market in Berlin, Dusseldorf, Hanover, Munich, Stuttgart, Tradegate Exchange
End of News
DGAP News Service
546375 21.02.2017