Zalando promises strong 2017 after 23% revenue rise

Zalando

Zalando increased its revenue by 23% to €3,639m in 2016 and has set guidance of a 20%-25% revenue increase in 2017.

The German-based ecommerce giant achieved an adjusted EBIT of €216.3m (5.9% margin) in 2016 and is expecting a 5%-6% margin this year as it “expects to continue outperforming the fashion retail market again”.

Zalando co-CEO Rubin Ritter has also promised the business will continue with significant investment in technology, logistics and staff and is looking at a CAPEX outlay of around €200m in 2017 (compared to €181.7m last year).

Strong growth requires non-stop investment. We are proud to have significantly progressed in expanding our business profitably,” said Ritter.

“As we build the technology and operating system to transform the European fashion industry, we will further invest into a unique and flawless consumer experience and a stronger supplier proposition to continue to drive growth ahead of the market. At the same time, we plan to expand our team by creating more than 2,000 new jobs this year,” Ritter added.

Zalando
Rubin Ritter: “non-stop investment”

Last year the multi-brand men’s, women’s and kids etailer attracted 20m customers. Its technology team was increased from 1,000 to 1,600 and its pan-European logistics network is set to expand into 20,000-30,000 m² warehouses in France and Sweden as well as a 130,000 m² logistics centre in Poland.

Furthermore it has plans to expand into the growing sports category and earlier this week it agreed to acquire the retail business of Munich-based KICKZ AG, the leading multi-channel basketball retailer. The transaction is subject to merger control clearance by German and Austrian competition authorities, and is expected to close in the first half of 2017. All parties have agreed not to disclose financial details, it said.