Lindex, the well-known Finnish retail powerhouse under the ownership of Stockmann, has recently seen a mix of ups and downs in the news. Despite facing some hurdles, the company is maintaining a cautious optimism regarding the future, especially in light of the successful turnaround of its subsidiary, Lindex.
CEO Lauri Veijalainen is pleased to report a significant upturn in the group’s adjusted operating result, with Lindex experiencing growth in its key markets along with a substantial spike in online sales. The adjusted operating profit for Lindex almost doubled, attributed to increased sales, a boosted gross margin, and cost-saving measures. However, the overall revenue figures for the group took a hit, particularly in the fourth quarter.
In 2018, the group’s revenue dipped from €1,055.9 million to €1,018.8 million, even though the gross margin saw an improvement of 56.9%. Adjusted profit based on an Ebitda basis rose from €67.8 million to €76 million, while the adjusted operating profit surged from €12.3 million to €28.4 million. Despite recording a net loss of €43.7 million, it marked a substantial improvement from the prior year’s €198.1 million loss.
Although the Q4 results were not as promising as anticipated, Stockmann is resolute in its commitment to bolstering the profitability of its operations. The Stockmann Retail unit encountered challenges, failing to achieve positive results despite concerted efforts to drive sales. The company acknowledged the disappointing performance of the unit and is actively incorporating cost-saving strategies to enhance profitability.
Moving forward, Stockmann is looking to ramp up sales, boost the gross margin, and expedite digital initiatives to enrich the overall customer experience. While the economic outlook in certain operating countries appears favorable, the company foresees retail sector challenges due to an economic slowdown in Finland.
Despite these obstacles, Stockmann sees potential in the growth of its e-commerce endeavors as consumer behavior trends towards digital platforms. Yet, the company concedes that physical stores will continue to grapple with challenges as the retail industry undergoes digital transformation and further globalization. Ultimately, Stockmann is unwavering in its commitment to navigating the shifting retail landscape and ensuring the enduring success of its brand.
Sources:
1. Lindex Official Website
2. Stockmann Group Official Website
