A Zalando fulfillment center.

BERLIN — Despite challenging market conditions, Zalando continued to surge ahead in the third quarter, posting a net profit of 5 million euros, or $5.6 million, compared to a loss of 28.5 million euros, or $31.7 million, in the same period a year ago.

Dollar figures are calculated at average exchange rates for the period concerned.

In final figures released today, the Berlin-based European e-commerce giant came in at the higher end of its projected third-quarter operative earnings and sales ranges published mid-October.

Zalando reported a 17.1 percent gain in adjusted earnings before interest and taxes to 19.5 million euros, or $21.8 million, compared to an operative loss of 23.5 million euros, or $26.1 million, in the third quarter of 2015. The adjusted third-quarter EBIT margin hit 2.3 percent.

Group sales gained 17.1 percent to reach 834.8 million euros, or $932.1 million, in the period ended Sept. 30. Regionally, sales in the German, Austrian and Swiss markets grew 9 percent, while the rest of Europe pushed ahead 24.3 percent.

Based on the group’s strong profitability in the first nine months – which saw adjusted EBIT more than triple to 120.7 million euros, or $134.7 million, compared to 35.7 million euros, or $39.7 million for the period in 2015 – Zalando reconfirmed its upwardly revised full-year forecast.

It expects sales growth to come in towards the high end of a 20-25 percent growth range, and an adjusted EBIT margin of 5-6 percent. The e-tailer also repeated its longer-term ambitions of 20-25 percent sales growth “over the next few years.”

In other third-quarter developments, Zalando continued to improve its mobile offering and performance. Mobile traffic grew 67 percent, and the share of mobile orders surpassed 50 percent, the company said. Active customers reached 19.2 million in the July-September period, with 13.2 percent more average orders placed than a year previously.

Operationally, Zalando’s new south German facility in Lahr is now up and running, a new hub in Poland is slated to start operations in the second quarter of 2017 serving the German, Poland and Nordic markets, and a local satellite warehouse close to Paris is set to open in the first quarter of next year.

Zalando also noted that the sold-out premiere of its consumer show Bread & Butter last September gathered more than 800 million impressions across all media and social media channels, and reconfirmed plans for a second Zalando Bread & Butter in 2017.

In a telephone conference Thursday, Zalando co-chief executive officer Rubin Ritter was optimistic about the remainder of the year. “We’re looking forward to a great Q4,” he said, adding that Zalando would place a strong focus on gifting items and gift cards for the Christmas season. Looking further ahead, he noted, “We have built a strong platform for ongoing progress and an exciting 2017.”

load comments
blog comments powered by Disqus