Adolfo Domínguez Loses 9.3 Million In 2021 With Sales Still 20% Below

Adolfo Domínguez registered a new year of losses, with 9.3 million euros for the 2021/2022 financial year (closed in February), and a positive gross profit of 0.4 million euros, which means leaving behind the red numbers for the year 20/21, when ebitda stood at -6.8 million euros.

“It has been a year with comings and goings with the different waves of the pandemic. Even so, we can feel positive. We have closed the year with a positive EBITDA and some results, focusing on the second half with an EBITDA of 6 million euros and a net profit of 1.5 million” , pointed out Antonio Puente, who will be proposed as the new CEO, a position that until now was also assumed by Adriana Domínguez, who will now remain as president with executive functions.

The figures presented by the Galician fashion firm are still slightly worse than the numbers achieved prior to the impact of Covid, when Adolfo Domínguez registered losses of 8.3 million euros in the 2019-2020 financial year (until February). The previous year, 2018/2019, the company managed to practically touch the net profit, a feat that it has not achieved since 2016.

Regarding sales , the company reached 92 million euros , which is 39.5% higher than 2020-2021, although they are still below the 114.7 million euros prior to the pandemic. In comparable terms, sales improve by 43.4% .

Online sales , meanwhile, have multiplied by three in the last five years, reaching 13 million euros last year (closed in February), the same amount as a year ago. In total, they represent 14% of total income, and are 20% higher than the pre-Covid stage. The gross sales margin is also higher, up to 56.1% , 0.2 points above the 2019/2020 financial year. “The goal is not only to maintain it, but to improve it,” says Antonio Puente. “We want to be profitable and to be profitable we need to grow,” he continues.

By region, the growth of comparable sales in Europe stands out, where they grew by 44%, with 180 points of sale. Mexico, the second largest market with 126 establishments, managed to grow comparable sales by 67%, compared to 3.4% in Japan. In the rest of the world, sales grew 26% last year.

Adolfo Domínguez continues with its expansion abroad. For the first time, more than half of its establishments (53%) are already outside of Spain . It closed the year 21/22 with 348 stores, 6 more than the previous year.

Inflation: There will be no price hike
“We are not focused solely on price,” says the management of Adolfo Domínguez. The fashion brand rules out transferring the impact of an inflationary context like the current one to the final price, something that it will compensate for by bringing production closer to Spain or by managing volumes with suppliers to try to manage the increase in costs that put pressure on margins . “We want to have a price that is comfortable enough so that it is not prohibitive for the client,” says the president of the firm, who insists on the fact that Adolfo Domínguez is less sensitive to the increase in the CPI than other industry firms.

The firm recognizes, however, that in March it has noticed some “instability” due to the increase in the CPI, although “in April” a decrease has already been noted. “There was an evolution out of the pandemic with a dammed up demand that has stopped again. It is still too early to say if that demand is going to emerge, but it is a fact that it is there. This year may be a year of recovery for us “, acknowledges Puente during the presentation of the group’s results in Madrid.

As for the situation unleashed by the war in Ukraine, Adolfo Domínguez only has a few multi-brand establishments in Russia “where we have had to stop shipments,” explains Anabel Rúa, director of global retail for the brand, pointing out that the sales in the country represent a very small part of the total.

25th anniversary on the stock market
Adolfo Domínguez celebrates this year its 25th anniversary as listed on the national stock market. “She was the doyen of the fashion world. She came out with a lot of euphoria (…) and it was done to start a very familiar company,” says Adriana Domínguez, current executive president and daughter of the legendary Galician fashion designer. Currently, 31.5% of the capital continues to be held by the family.

“We want to recover what Adolfo Domínguez was in the 1980s. He was the one who dressed the transition in our country. With our slogan The wrinkle is beautiful , we want to highlight that we live in a time of great diversity. We believe in a more fluid definition of beauty” , recognizes Domínguez, at the head of a company that has been promoting the inclusion of women and men of different ages in its sector for years, in the face of a general trend for youth linked to success.

However, the trajectory will be long in the stock market. At the time of its IPO, the company (according to adjustments made to its price after a quarter of a century) was listed at the equivalent of 24.6 euros per share. Today it is trading on 3.6 euros. Before the outbreak of the pandemic, its shares were exchanged at a price of 6.4 euros, which represents a rise from current levels of 78%. After the presentation of its results at mid-morning, the shares yield 1% on the floor.

Posted on

Leave a Reply

Your email address will not be published. Required fields are marked *