- Prachi Singh |
Global Fashion Group (GFG) reported stable net revenue and net merchandise value (NMV) growth in the third quarter. The company’s net revenue for the quarter was 256.4 million euros (305 million dollars), a 21.1 percent growth on a constant currency pro-forma basis. The company added that exchange rates impacted the group, reducing growth on an absolute euro basis to 19 percent.
NMV, which includes marketplace sales, reached 265.1 million euros (315 million dollars), increasing 22.2 percent on a constant currency pro-forma basis and 20.7 percent on an absolute Euro basis. Operational efficiency gains, GFG said, lead to improved adjusted EBITDA margin. Adjusted EBITDA for the quarter was 32.6 million euros (38 million dollars), with margin improving by 2.8 percentage points to 12.7 percent of net revenue.
GFG’s regional businesses performed well in Q3
The company added that Lamoda’s Q3 NMV and net revenue grew by 12.7 percent and 16.7 percent on a constant currency basis and 17.3 percent and 21 percent on an absolute euro basis. The company further said that retail environment remains challenging in the region, leading to further investment in gross margin of 0.8 percentage points in the quarter.
Dafiti had a strong quarter of revenue growth, with increased Q3 NMV and net revenue growth on a constant currency basis of 22.1 percent and 19.5 percent, respectively. On a euro basis, NMV and net revenue grew by 17.6 percent and 15.1 percent respectively. Gross profit for the region fell by 2.2 percentage points to 43.1 percent, due to increased price investment and a non-recurring one of benefit in 2016. On a year to date basis, gross profit margin remained flat at 43.5 percent.
Zalora and The Iconic, GFG said, continued their top line growth, with NMV and net revenue growing by 33.4 percent and 28.5 percent, respectively, on a constant currency basis. On a euro basis, the growth rates were 28.3 percent and 23 percent, respectively. Gross profit margin increased by 0.7 percentage points to 39.4 percent.
The company said, as mentioned in the Q2 earnings release, the partnership in the Middle East with Emaar Malls acquiring 51 percent of Namshi was successfully completed in August for a consideration of 151 million dollars. The partnership in the Philippines with Ayala acquiring a 49 percent of Zalora Philippines was also completed in August.