Wolford profits tumble but sales rise

Wolford has recorded a 1.1% increase in third quarter sales, despite facing harsh retail conditions.

The Austrian lingerie and legwear group said revenue rose to €128.7 million (£100mn) in the first nine months of 2015/16, against a backdrop of a challenging economic and political environment additionally burdened by warm winter temperatures.

However, profits took a tumble in Q3, amounting to €2.16 million, compared to the prior-year level of €7.08 million.

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Wolford said this was driven by the increase in value of the US dollar and the British pound, as well as "one-off effects" reported in 2014/15.

Adjusted to include all one-off effects, earnings before tax was up by €1.02 million from the previous year.

Revenues decreased in Wolford’s core markets, Austria and Germany. The tense economic situation in Russia has also negatively affected revenue development in Central and Eastern Europe.

Wolford still succeeded in maintaining revenues in France at the prior-year level in spite of an initial revenue decrease related to the dramatic events which took place in Paris last November.

The UK, Italy, Spain, Scandinavia, Belgium, the Netherlands and the US all generated revenue growth.

Commenting on its future outlook, Wolford said in a statement: “Outlook It is difficult at the present time to make predictions about the further development of Wolford’s core markets. This especially applies to the company’s retail activities in France.

“As long no recovery takes place in these markets, it will be a challenge for Wolford to achieve its declared objective of generating positive operating results. Nevertheless, despite these circumstances, Wolford’s management also expects higher revenues in the 2015/16 financial year as a whole compared to the previous year.”

Wolford’s own retail business made a substantial contribution to revenue growth, rising 5% in the first three quarters of 2015/16.

The online business was also successful, as shown by its 66% growth.

 

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