Tendam posts flat sales while profits grow in first half of year
today Oct 29, 2019
Spanish clothing group Tendam continues to deliver sustained growth. Revenues at the group rose 0.9% to €559.5 million ($620m) in the first half of the year, experiencing a slight increase from the €554.4 million the company recorded in the same period in the prior year.
Growth was boosted by a double-digit rise in online sales, which surged by 39% in the period between 1 June and 31 August. The e-commerce business now accounts for 8.9% of total revenues. A breakdown reveals that Women’Secret, the group’s lingerie chain led the way with a 54.2% increase in online sales, followed by Fifty, Cortefiel, Pedro del Hierro and Springfield. In the first half of the year, online sales rose 37%.
Meanwhile, second quarter Ebitda improved to €93.1 million ($103m) from €61.4 million a year earlier. Excluding the impact of applying IFRS 16, a new lease accounting standard in Spain, Ebitda would have been €700,000 less than reported.
“The results are a testament to our solid and consistent business model. Despite a backdrop of economic and geopolitical instability, we’re cautiously optimistic about the future,” said Jaume Miquel, chairman and CEO of Tendam.
“The combination of the strengths of our brands, advanced and integrated CRM capabilities in our loyalty programme, as well as the close ties between the online business and our streamlined store network constitutes the best guarantee to secure positive and profitable growth.”
Loyalty scheme and sustainability plans
During the period, Tendam continued to invest in its loyalty scheme with the support of the newly created data science team. This is because the loyalty programme is key to the business, totalling 24.6 million members and accounting for 74% of sales across the group.
Tendam has also highlighted the progress of its sustainability plan, posting higher sales
of sustainable products across all of its brands. These include items from the Women’Secret Honest collection, which is made using organic cotton and recycled materials, and the H20 Denim manufacturing initiative, which uses 20% less water. 70% of jeans sold by Cortefiel Man are now produced in line with this new standard, the group said.
“The company is firmly committed to expanding the more sustainable collections and programmes in the coming quarters. Tendam and its brands are deeply committed to society as a whole. Initiatives including the Post-Surgery Bra and Honest by Women’secret, Reconsider by Springfield or Eco-Friendly at Cortefiel have gone down extremely well with our customers and they encourage us to power on in this direction,” Miquel continued.
Founded in 1880 as Grupo Cortefiel, Tendam is currently majority owned by CVC and Pai, which acquired a 33% stake in the business from Permira for €400 million in July 2017. The company, which opened 44 directly managed stores in the past 12 months, has a presence in 90 countries through 2,012 locations.
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