XXL’s core markets have continued to be challenging in the fourth quarter 2019. Poor winter conditions in the main cities combined with continued heavy discounting by our main competitors has contributed to negative like for like growth of around 12 per cent for the quarter, with all markets posting negative like for like growth. December and in particular Christmas sales have been weak.
XXL estimates total operating revenues for the Group in 2019 to be around NOK 9.0 billion (NOK 9.5 billion)
XXL has continued to focus on reducing the inventory level of the Group. Combined with lower sales, XXL has substantially reduced its purchased volumes, which negatively affected the bonuses from suppliers of NOK 90-100 million in 2019. As a result, EBITDA for the year is expected to be in the range of NOK 870 – 900 million (NOK 541 million*) before write-down of inventory, if any, in connection with completion of the fourth quarter 2019 financial statements.
Based on the preliminary results and the expected net interest bearing debt as at 31 December 2019, XXL expects to be in compliance with applicable loan covenants in the fourth quarter of 2019.
XXL will present the actual fourth quarter 2019 figures on 7 February 2020.
*IFRS 16 was implemented from 1 January 2019, and the EBITDA for 2018 is therefore not directly comparable to 2019
Press contact Norway:
Marte Ramuz Eriksen
Email: presse@xxl.no
Phone: + 47 952 21 425
Press contact Sweden and International
Anders Andrén
Email: press@xxl.se
Phone: +46 76-133 99 40
Investor Relations
Tolle Grøterud
Email: tolle.g@xxl.no
Phone +47 90 27 29 59
Definitions
Alternative Performance Measures (APM)
Certain financial measures and ratios including growth, EBITDA, (collectively, the “Non-GAAP Measures”), are not specifically defined under IFRS or any other generally accepted accounting principles. These measures are presented in this statement because they are among the measures used by Management to evaluate the cash available to fund ongoing, long-term obligations and they are frequently used by other interested parties for valuation purposes or as a common measure of the ability of a company to incur and meet debt service obligations. These measures may not be comparable to other similarly titled measures of other companies and are not measurements under IFRS or other generally accepted accounting principles, and you should not consider such items as alternatives to profit for the year, total operating revenues, operating income or any other performance measures derived in accordance with IFRS, and they may be different from similarly titled measures used by other companies.
EBITDA
Earnings before interest, tax, depreciation and amortisation (EBITDA) is a key financial parameter for XXL. EBITDA represents operating income plus depreciation.
Like for Like
Like for Like include comparable stores and E-commerce. Comparable stores are stores that have been open all months of the current year and all months of the previous year. Stores that have been relocated or significantly expanded are excluded from Like for Like stores.
Net interest bearing debt
Net interest bearing debt is defined as non-current interest bearing debt and current interest bearing debt less cash and cash equivalents. Net debt is a measure of the Group’s net indebtedness that provides an indicator of the overall balance sheet strength.