Successful 2019/2020 financial year: bonprix increases turnover to €1.74 billion

• Fashion company grows profitably for the 11th consecutive year

• Positive developments in many Eastern and Western European markets and slight increase in Germany

• Current financial year challenged by coronavirus pandemic, crisis management takes immediate measures to counteract impact on sales and earnings

The bonprix Group, one of the Otto Group's highest-revenue groups, has successfully concluded the 2019/2020 financial year (29 February 2020). The vertically integrated international fashion brand increased its sales revenue from €1.57 billion to around €1.74 billion (IFRS), marking its eleventh consecutive year of sustainable profitable growth. On a comparable basis, this corresponds to planned sales growth of 2.4 per cent* compared with the previous year. The reported sales performance was boosted by the first-time inclusion of the Russian business, which was integrated into the bonprix Group by the former Otto Group Russia in the 2019/20 financial year. Including the activities in Russia, sales increased by around 10 per cent in the past financial year. bonprix slightly increased its return (EBIT) compared to the previous year. Against the backdrop of the global coronavirus pandemic, the Hamburg-based company is preparing for major challenges in the current 2020/2021 financial year. Measures introduced early in the first quarter to stabilise operations are having a positive effect.

Financial statements for the 2019/2020 financial year

"2019/2020 was a very good financial year for bonprix. Internationally, we recorded very positive customer developments across almost all markets and excellent sales developments in many Eastern and Western European countries,‘ said Dr Kai Heck, bonprix's managing director responsible for finance, commenting on the preliminary figures. ’We are particularly pleased with the positive trend in our home and core market of Germany, where we were able to improve slightly again at a high sales level."

bonprix generates over 60 per cent of its total sales abroad. In the past financial year, almost all international markets achieved very good growth rates. France in particular had a record year, achieving the highest sales and profit growth since the start of operations in 1991. Over the last three years, the vertically integrated fashion brand has increased its cumulative sales there by 30 per cent and doubled its earnings. Switzerland, Austria, the Netherlands and the markets in Eastern Europe also continued to perform very strongly, with predominantly double-digit growth rates in sales.

Business in Russia and the United States remained challenging, but bonprix has made progress here too. In the United States, the bonprix brand VENUS was able to recover from the weaker previous years by focusing on the digital transformation of its long-established catalogue business and maintain sales at almost the same level as the previous year. In Russia, intensive sales measures were implemented in the past financial year to revive the sluggish but promising business – with initial positive effects on business development and earnings.

On the German market, the fashion retailer's sales in 2019/2020 were slightly above the previous year's level. Despite tough competitive conditions in the fashion retail sector, the company was able to benefit from improved customer service and the IT conversion in 2018 and further expand its largest market. bonprix.de remains in second place among the highest-grossing online shops in the fashion sector in Germany.**

Current developments under the influence of the coronavirus pandemic

The start of the 2020/2021 financial year at bonprix has also been strongly influenced by the coronavirus pandemic. Internationally, many markets recorded significant declines in sales compared to the previous year, particularly in the period from mid-March onwards. The fashion retailer was confronted early on with developments in China and the difficult situation in the Italian market. An international crisis management team was set up at short notice to ensure the health and safety of the approximately 4,000 employees and to mitigate the implications for the international bonprix markets as best as possible. Numerous immediate sales measures were introduced in the first quarter of the current financial year. The effects are positive: demand has improved noticeably in almost all markets. The measures introduced include changes to services and conditions for customers, as well as adapted marketing of product ranges to meet current purchasing needs. The focus is currently on comfortable clothing for home wear, sportswear and outdoor jackets for walks, as well as products from the Home & Living range. In many of these segments, bonprix is recording positive sales developments in its international web shops.

The fashion retailer is also currently producing fabric face masks, which are in high demand among the general public. These non-medical, washable makeshift masks for everyday use will be available from around mid-May in the bonprix web shop and in the bonprix fashion connect store in Hamburg's Mönckebergstraße.

"The coronavirus pandemic is an unprecedented crisis for all of us, with long-term consequences for the economy that cannot yet be estimated. We are also unable to make any reliable predictions about developments for bonprix,‘ says Dr Richard Gottwald, CEO and also responsible for international sales, describing the current situation. ’Our markets are currently affected to varying degrees. In the textile sector in particular, there may be challenges in areas such as procurement or country-specific logistics that are difficult or impossible to influence. But we are constantly analysing the extremely volatile situation and taking appropriate measures to counteract it effectively."

In the past, bonprix has repeatedly succeeded in successfully compensating for critical international conditions through the strategic management of its market portfolio. Even now, Richard Gottwald believes that, despite all the uncertainties, the company is well positioned to weather the current crisis and secure bonprix's financial strength. ‘Agile and highly flexible crisis management and action-oriented short-term planning will continue to be the guiding principles of our economic activities,’ explains Richard Gottwald. "We are doing everything we can to keep our business operations stable and continue to provide our customers with a convenient online shopping experience. And I am confident that with our dedicated team and in close and fair cooperation with our suppliers and partners, we will achieve this."

* On a comparable basis, i.e. excluding the Russian business, the bonprix Group generated a 2.4 per cent increase in turnover from over 1.57 billion euros to around 1.61 billion euros compared to the previous year.

**Source: Study ‘E-Commerce Market Germany 2019’ by EHI Retail Institute/Statista. The ranking is based on sales figures.