DGAP-News: TOM TAILOR GROUP achieves growth in all segments

DGAP-News: TOM TAILOR Holding AG / Key word(s): 9-month figures/Development of Sales TOM TAILOR GROUP achieves growth in all segments in first nine months of 2015 10.11.2015 / 07:30 --------------------------------------------------------------------- - Group sales show 1.5% increase amid generally weak market - Earnings reflect market conditions as well as investments in expansion and marketing / adjusted EBITDA margin of 6.9% (previous year: 8.4%) - In September concretized forecast for current fiscal year confirmed - "CORE" cost reduction and efficiency program to increase competitiveness Hamburg, 10 November 2015. The TOM TAILOR GROUP achieved further growth in the first nine months of 2015 despite the ongoing challenges posed by the market. The company posted sales increases in all segments, with a Group-wide increase in revenues of 1.5% to EUR 689.6 million (previous year: EUR 679.1 million). On the income side, the continuing expansion of the TOM TAILOR GROUP led to higher expenses, including higher costs for personnel and retail space, but also marketing expenses for the BONITA TV campaign. As a result, recurring EBITDA amounted to EUR 47.3 million for the reporting period (previous year: EUR 56.9 million). "Considering the difficult market environment, we are quite satisfied with our sales development in the first nine months of the year. Our umbrella brands have again demonstrated their strength and outperformed the market as a whole," said Dieter Holzer, CEO of TOM TAILOR Holding AG. "After the income-side setback in the third quarter due to significant start-up problems at our new logistics center, we will make the best possible use of the remaining months of this year. Another priority will be to map out the details of our planned 'CORE' cost reduction and efficiency program. Our clear objective is to improve the Group's profitability." To strengthen the Group's long-term competitiveness in a persistently challenging market environment, the TOM TAILOR GROUP launches a comprehensive cost reduction and efficiency program. Within the scope of the "CORE" program, which was unveiled yesterday, the company will focus on its core brands, optimize the store network in terms of profitability, and reduce the operating costs. The goal is to bring about substantial gains in the Group's efficiency, improve processes and the cost base and, in combination with the verticalization efforts already underway, position the TOM TAILOR GROUP for profitable growth in the long term. Sales increases in all segments The German textile market remained volatile in the third quarter, with industry-wide sales down by 2.0% (Source: TW-Testclub 40/2015). In this market environment, the TOM TAILOR GROUP competed successfully with its two umbrella brands, TOM TAILOR and BONITA. The retail business of the TOM TAILOR brand maintained its upward trend from the previous quarter and posted a 6.4% increase in sales. As a result, the segment showed an overall sales plus of 3.4% to EUR 195.0 million for the reporting period (previous year: EUR 188.6 million) despite a slow start to the year. TOM TAILOR E-Commerce delivered particularly strong results, with a 9.6% sales increase in the third quarter fully compensating the decline in the first half of the year. The number of TOM TAILOR retail stores has increased by 55 to 437 since the end of 2014. Sales for the TOM TAILOR wholesale business rose by 0.9% to EUR 251.5 million (previous year: EUR 249.0 million). After a strong first half, sales in the third quarter showed a year-on-year decrease, partly due to the high comparable figures, but above all as a result of shipping delays related to the launch of the new logistics center. Consequently, sales in the third quarter were 6.4% lower than in the previous year. Since the start of the year, the number of shop-in-shop spaces has increased by 217 to 2,903. Meanwhile, franchise shops have decreased from 206 to 197, mainly through the conversion of shops into the retail organization. Sales of the BONITA umbrella brand increased slightly from January to September by 0.8% to EUR 243.1 million (previous year: EUR 241.2 million). BONITA thus accounted for a 35.2% share of Group sales (previous year: 35.5%). The brand's performance was dampened in the third quarter especially because of the weak market environment in August, resulting in a 3.9% year-on-year decrease in sales. The number of BONITA stores increased to 1,023 (30 September 2015). Income situation reflects investments in expansion Gross profits for the TOM TAILOR GROUP in the first nine months slightly increased by 0.1% to EUR 385.9 million (previous year: EUR 385.4 million). The gross profit margin was down by 0.8 percentage points to 56.0% (previous year: 56.8%), mainly as a result of investments into the product as well as a lower gross profit margin for BONITA, which remains with 65.2% nevertheless at a good level (previous year: 67.0%). In response to the need for flexible logistics, the TOM TAILOR GROUP opened a new, state-of-the-art logistics center in June 2015, thus creating a central and fully operational warehouse for the TOM TAILOR brand. The launch of the new facility by the logistics partner was followed by at times substantial delays in the shipment of goods in the third quarter. This reduced the Group's gross profit by EUR 7.0 million. Excluding this one-off effect, the recurring EBITDA amounted to EUR 47.3 million (previous year: EUR 56.9 million), which results in a recurring EBITDA margin of 6.9% (previous year: 8.4%). The decrease as compared with the same period a year earlier relates above all to higher investments in the continued expansion and expenses for the new BONITA TV campaign. Reported EBITDA for the Group amounted to EUR 36.5 million (previous year: EUR 54.9 million). Over the first nine months, the recurring net result of the TOM TAILOR GROUP was EUR 3,3 million (previous year: EUR 9.4 million), and recurring earnings per share (EPS) amounted to EUR -0.01 (previous year: EUR 0.22). The reported net result was EUR -10.3 million, as compared with EUR 1.8 million in the previous year. Reported earnings per share amounted to EUR -0.54 (previous year: EUR -0.08). Cash flow from operating activities decreased by EUR 28.3 million to EUR 18.4 million (previous year: EUR 46.8 million), mainly as a result of the lower EBITDA as compared with the same period a year earlier and a rise in net working capital. From January to September, the TOM TAILOR GROUP made investments of EUR 26.3 million (previous year: EUR 12.8 million), in particular in the expansion of its three business segments and increasing its stake in the subsidiaries in Hong Kong and Southeast Europe. As a result, the free cash flow amounted to EUR -16.4 million (previous year: EUR 26.1 million). Net debt increased as expected to EUR 235.8 million as of 30 September 2015 (30 September 2014: EUR 205.8 million). The equity ratio at the end of the reporting period was 25.5% (30 September 2014: 29.2%). Concretized forecast for fiscal year 2015 confirmed On 21 September, the TOM TAILOR GROUP concretized its forecast for the current fiscal year. The Management Board now anticipates a moderate increase in Group sales to EUR 945-955 million. In addition, the Group expects to achieve a recurring EBITDA in the range of EUR 75-80 million. In view of the coming Christmas season and the current economic and consumer climate, the Management Board of the TOM TAILOR GROUP has a generally positive outlook for the fourth quarter. KEY FIGURES FOR THE GROUP Q3 Q3 Change 9M 9M Change in EUR million 2015 2014 in % 2015 2014 in % Sales 248.1 253.8 -2.2 689.6 679.1 1.5 TOM TAILOR retail 68.9 64.7 6.4 195.0 188.6 3.4 BONITA 84.0 87.4 -3.9 243.0 241.2 0.8 TOM TAILOR wholesale 95.2 101.7 -6.4 251.5 249.3 0.9 Gross profit 133.4 136.1 -2.0 385.9 385.5 0.1 Gross profit margin in % 53.8 53.6 - 56.0 56.8 - Recurring EBITDA 21.0 26.4 -20.5 47.3 56.9 -16.9 Recurring EBITDA margin in % 8.5 10.4 - 6.9 8.4 - One-off items 8.6 0.9 872.1 10.8 2.0 429.8 EBITDA 12.5 25.6 -51.2 36.5 54.9 -33.5 EBITDA margin in % 5.0 10.1 - 5.3 8.1 - Recurring net result for the period 5.7 9.8 -41.6 3.3 9.4 -65.0 Recurring earnings per share (in EUR) 0.15 0.30 -49.7 -0.01 0.22 -106.1 One-off items including deferred taxes 7.8 2.7 188.5 13.6 7.6 77.5 Net result for the period -2.0 7.1 -128.7 -10.3 1.8 -671.1 Earnings per share (in EUR) -0.15 0.19 -177.4 -0.54 -0.08 -612.4 Cash flow from operating activities 12.7 40.0 -68.2 18.4 46.8 -60.6 Cash outflow from investing activities -11.6 -5.7 -102.4 -26.3 -12.8 -104.6 30.09.2015 30.09.2014 Change in % Total assets 839.0 795.8 5.4 Equity 214.3 232.7 -7.9 Equity ratio (in %) 25.5 29.2 - Cash and cash equivalents 57.0 36.7 55.1 Net debt 235.8 205.8 14.6 Absolute Points of sale 30.09.2015 31.12.2014 change Retail stores 1,460 1,395 65 Franchise stores 197 206 -9 Shop-in-shops 2,903 2,686 217 About TOM TAILOR GROUP TOM TAILOR GROUP is an international fashion and lifestyle company offering stylish clothing and accessories in the medium price range through its umbrella brands TOM TAILOR and BONITA. The TOM TAILOR brand comprises the brands TOM TAILOR, TOM TAILOR Denim, TOM TAILOR POLO TEAM and TOM TAILOR CONTEMPORARY. Its collections are aimed at a target group aged between 0 and 40 and are distinguished by premium quality. BONITA, one of Germany's leading fashion brand producers and retailers, has been a part of TOM TAILOR GROUP since August 2012. BONITA sells menswear and womenswear collections for the over-40 age group. In the fiscal year 2014, the TOM TAILOR GROUP recorded sales of EUR 932.1 million, of which EUR 324.9 million were generated by BONITA. The TOM TAILOR brand is sold through the segments Retail and Wholesale, thus via own mono-label stores as well as via partners. At the end of September 2015, these comprised 437 TOM TAILOR stores, 197 franchise stores, 2,903 shop-in-shops and around 9,500 multi-label points of sale. Therewith the brand is present in 35 countries. BONITA operates 1.023 retail stores of and by now also eight shop-in-shops. Furthermore, the collections of both brands are available over the respective online stores. 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 Erika Kirsten Manager Corporate Communications TOM TAILOR GROUP Phone: +49 (0) 40 58956-420 Email: erika.kirsten@tom-tailor.com --------------------------------------------------------------------- 10.11.2015 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. Media archive at www.dgap-medientreff.de and 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 Indices: SDAX Listed: Regulated Market in Frankfurt (Prime Standard), Hamburg; Regulated Unofficial Market in Berlin, Dusseldorf, Hanover, Munich, Stuttgart End of News DGAP News Service --------------------------------------------------------------------- 410655 10.11.2015