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Stockmann group's new profit guidance for 2014, revenue in September

Published 16 October 2014

Stockmann’s on-going strategy process aims to improve the Group’s competitiveness and profitability in the long-term, but the outcome of the process will not yet be visible in the 2014 earnings.

The Stockmann department stores' Crazy Days campaign achieved a relatively good sales result in October, but both revenue and operating result in September were low in all businesses.

Due to the weaker-than-estimated performance, particularly in Seppälä's business, and unstable outlook for the rest of 2014, Stockmann's profit guidance for the year has been changed. Stockmann now expects that the Group's operating result, excluding non-recurring items, will be negative in 2014.

Previous profit guidance for 2014 (published on 12 June 2014):
Stockmann estimates that the Group's euro-denominated revenue in 2014 will decline on 2013. The Group's operating profit in 2014 is expected to be significantly weaker than in 2013.

Crazy Days campaign's revenue in October 2014

Revenue from the Crazy Days campaign, which took place between 8 and 12 October in all department stores and the Stockmann online store, was on the previous year's level at comparable exchange rates. Revenue from the online business in Finland continued to grow strongly, and all department stores also achieved a good result compared to the weak sales trend during the summer and early autumn of the year.

The campaign's revenue was up by 5 per cent in the Baltic countries. In Russia rouble-denominated revenue was up 4 per cent, but euro-denominated revenue was down 10 per cent. In Finland revenue was down 2 per cent, though sales grew by 33 per cent in the online store. In total, euro-denominated revenue was down 4 per cent due to weak currency exchange rate of the rouble.

Revenue in September 2014

The Stockmann Group's revenue was down 13.9 per cent on the previous year and amounted to EUR 133.3 million in September 2014. The weak exchange rates of the Russian rouble, Swedish krona and Norwegian krone continued to negatively affect euro-denominated revenue. Revenue at comparable exchange rates was down 10.6 per cent.

The Department Store Division's revenue was up in the Baltic countries, but down in Russia and in Finland. The division's euro-denominated revenue decreased by 13.6 per cent; it was down 13.1 per cent in Finland and 14.6 per cent in international operations.

Lindex's revenue was down by 6.3 per cent at comparable exchange rates. Due to currency effects, euro-denominated revenue was down 11.8 per cent. Seppälä's revenue was down 30.1 per cent. In Russia the number of stores has halved from the previous year, and the goal is to close the remaining 16 stores during 2014 and 2015. The Fashion Chain Division's total revenue decreased by 14.3 per cent; it was down 13.7 per cent in Finland and 14.5 per cent in international operations.

Source: Company Press Release