Zalando, one of Europe’s leading online platform for fashion and lifestyle, expects its quarterly results to be significantly below its predicted Q1 results, which did not yet take into account the effects of the coronavirus.
In a statement, the company said it expects revenue and gross merchandise volume growth in the first quarter to be significantly below previous expectations, despite a strong start to the year.
Adjusted EBIT is also negatively impacted by lower sales growth in the first quarter and an exceptional write-down of inventories as a result of the revised sales expectations for the current season.
The guidance for the fiscal year 2020 published in February had explicitly excluded negative effects from the spread of the coronavirus, as such the company assumes that the published forecast can no longer be achieved.
The Management Board will reportedly issue new guidance as soon as the course of the pandemic can be estimated more reliably.
In a statement, Zalando’s Management Board said: “Zalando has a clear strategy and a clear direction. While we expect that the current crisis will have a negative impact in the foreseeable future, we do not expect it to change our longer term trajectory.
“We will continue to focus on our strategic priorities: to build even deeper customer relationships and to grow our platform business model. Wherever possible, we are prepared to invest through-cycle and drive long-term value creation even in this adverse environment.”