Today’s news in brief-19/10/23
Adidas has revised its full-year projections upward following robust Q3 2023 results. The sportswear giant’s performance was positively impacted by the sale of its remaining Yeezy inventory, leading to better-than-expected underlying business development. Now, Adidas anticipates an operating loss of €100m in 2023, down from the previous forecast of €450m. Revenues are projected to decline at a low-single-digit rate, an improvement from earlier estimates of a mid-single-digit drop. Additionally, excluding Yeezy-related one-offs, underlying operating profit is expected to reach €100m. The potential write-off for remaining Yeezy stock is now €300m, while strategic review costs remain at €200m. The first nine months’ results will be released on November 8.
Gear4music reports a 6% drop in revenues for H1 2023, totaling £62.6m. European and rest-of-world revenues declined by 15% to £26.1m. Conversely, UK sales increased by 3% to £36.5m. The group attributed these figures to prioritising gross margins over sales growth in a challenging market. Gross margin is expected to be 27.1%, an improvement of 80 basis points from the previous year, while gross profit is anticipated to fall to £17m from £17.4m. The group foresees UK revenues remaining stronger than European ones. CEO Andrew Wass emphasised progress in strategic objectives and affirmed their commitment to pricing discipline and efficiency.
Matalan reported Q2 revenues of £288.6m, a 0.8% increase compared to the same period last year. EBITDA surged by 16.6% to £47.9m after adopting the IFRS 16 accounting standard. Under the IAS 17 standard, EBITDA also increased by 8.7% to £25.1m. The company’s unrestricted cash at the end of the period was £130.4m, compared to £101.6m in the prior year. CEO Jo Whitfield attributed the strong performance to tight cost management, improved input prices, and better sales control amid a challenging retail environment.
Dunelm experienced a 9% sales increase to £390m in the first quarter, driven largely by volume growth. Digital sales contributed 35% to the period’s revenue. Growth was observed across various categories, with new ranges, including collaborations with Disney and the Natural History Museum, resonating well with customers. Upholstery ranges performed strongly, particularly sofas and sofa beds. The company launched its largest-ever marketing campaign in September to extend brand reach. One new store opened in the quarter, and three more are expected before the end of Q2, aligning with Dunelm’s target of five to ten new store openings for the year. CEO Nick Wilkinson emphasised the brand’s popularity and expansion efforts to capture a larger market share.
