Heatwave pushes Zalando to £34m loss in Q3 update

Zalando loss

Zalando has swung to a loss after its third quarter was adversely impacted by an unprecedented heatwave.

For the three months to September, the Berlin-based online fashion retailer said it experienced a “financially challenging quarter”, reporting an adjusted EBIT loss of €39 million (£34 million).

This compares to a year ago when its adjusted EBIT was a profit of €400,000.

On an unadjusted basis, EBIT was a loss of €55.7 million (£48.6 million) for the quarter, compared to a much small loss of €5.9 million loss a year ago.

Zalando attributed the performance to record-high summer temperatures which subsequently delayed the start of the autumn/winter season.

While quarterly sales increased 11.7 per cent to €1.2 billion (£1.04 billion), this was a marked slowdown compared to the 21 per cent sales growth recorded in the previous quarter.

Additionally, Zalando said the average basket size fell more than seven per cent to €57.50.

On the flipside, the online retailer said it now has 25.1 million active customers, an increase from 22.2 million customers a year ago.

“We are clearly not happy with our financial results in the third quarter,” Zalando co-chief executive Rubin Ritter said.

“Our eyes are set on building the ecosystem for European fashion at full speed and our 2020 target of doubling the business to €10 billion in gross merchandise volume.

“For the fourth quarter, the team’s full focus is now on pulling off a strong finish to the year.”

Click here to sign up to Retail Gazette‘s free daily email newsletter


Please enter your comment!
Please enter your name here