Wolford has lowered its full-year sales expectations after witnessing a significant decline in first-quarter revenue.
The Austrian lingerie and legwear company said that in light of an 18% drop in like-for-like sales and the “ongoing market weakness” in the month of August, it is “unlikely” that it will be able to make up for the revenue decrease during the rest of the financial year.
The group cited political uncertainty in the US, fear of terrorism in France and Brexit as factors that weakened consumption and reduced customer traffic.
Wolford’s retail business reported a 9% drop in revenue in the first quarter of the 2016/17 financial year in comparison to the prior-year period.
“Against this backdrop and additional negative currency effects (British pound), Wolford’s operating results in the first quarter of 2016/17 financial year amounted to minus EUR8.3 million (previous year: minus EUR 3,0 million) significantly lower than the company originally forecast,” Wolford said in a statement.
“This unfavourable earnings development can only be potentially offset to a limited extent in subsequent quarterly periods which traditionally report higher sales.”
Wolford now expects revenue for the 2016/17 financial year to stagnate or drop slightly below the prior-year level, and said it may see a “low single-digit” operating loss this year.
The group said it is implementing a programme of measures designed to increase revenue and enchance profitability.
The group will announce details on its business development on September 9.