Jul 30, 2014
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Yoox confirms 2014 guidance after Q2 meets forecasts

Jul 30, 2014

MILAN, Italy - Italian online fashion retailer Yoox stuck to its full-year forecast after meeting expectations with a 30 percent rise in second-quarter core profit thanks to higher sales, including in its struggling home market.

Yoox, which operates online shops for dozens of luxury brands ranging from Armani to Alexander McQueen, had sales of 111.5 million euros in March-June, up 15 percent from a year ago mainly thanks to the group's three own shopping websites.

Sales at Bologna-based Yoox should accelerate in coming months leading to a full-year revenue growth of slightly more than 20 percent.

"It is reasonable to expect a 2014 net revenue growth in the low-twenties at constant exchange rates," Yoox's head of financial communications told a conference call.

The core profit margin should be "a touch ahead" of the previous year's level, she added.

Core profit, or earnings before interest, tax, depreciation and amortisation (EBITDA), stood at 9.8 million euros in the second quarter, broadly in-line with a Thomson Reuters SmartEstimate.

Rising tablet and smartphone usage among Italians led to a 26.6 percent jump in domestic sales in the period, even as the Italian economy is struggling to leave a painful recession behind and overall consumer spending is stagnating.

Shares in Yoox have lost 38 percent so far this year, hit like those of other online retailers by concerns over the rising costs and investment needed to support online sales.

Britain's ASOS in June warned it would miss its full-year profit, sending its shares falling.

But analysts say Yoox is set to benefit from luxury groups bridging at least in part the gap with affordable fashion brands in expanding their online presence. Partnerships with luxury groups, once Yoox's engine growth, have stalled lately.

Yoox said it had this week signed a non-binding letter of intent with France's Lanvin to manage its online store globally.

It has also expanded its collaboration with U.S. designer Alexander Wang to include the United States, besides Europe and Asia, extending it to end-2017, it said.

In a more selective approach to this line of business, Yoox said it would end partnerships with leather group Coccinelle, shoemaker Vicini and fashion group Bally.

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