Oslo, 24 April 2019: Short term actions and initiatives to improve the profitability of XXL have already started to give positive effects but are at the same time affecting the sales volumes negatively. Going forward XXL is doing it outmost to fine tune and balance revenue growth against the gross margin development. In the first quarter 2019 XXL delivered total operating revenues of NOK 2 billion, representing a decline of 3 per cent. However, the gross margins are significantly higher in all markets and increased by 2.8 percentage points for the Group to 40.7 per cent. EBITDA amounted to NOK 192 million (NOK 51 million) and NOK 55 million when adjusting for the positive effects of the IFRS 16 implementation. XXL maintains the long term outlook and the strategic ambitions remains firm.
Highlights
- Total revenues of NOK 2 014 million (NOK 2 070 million), down 3 per cent
- Significantly higher gross margin of 40.7 per cent (37.9 per cent)
- EBITDA of NOK 55 million (NOK 51 million) adjusted for IFRS 16 effects
- Short term actions already giving positive effects
- Long term strategic ambitions remain firm
Outlook
XXL has signed 5 new lease agreements for store openings in 2019 where of 2 in Sweden, 2 in Finland and 1 in Austria and aims for 5-6 new stores in total for 2019.
In line with the existing growth strategy, XXL will continue to invest in new stores, E-commerce platform, existing stores, infrastructure and IT. Total CAPEX for XXL Group in 2019 is expected to be around NOK 200 million.
The Group has the following long term objectives (on full year basis and adjusted for IFRS 16 effects):
- Group like-for-like growth of low single digits over time including E-commerce
- Competition and E-commerce growth to put pressure on Group gross margin over time
- Group OPEX% as percentage of total operating revenues to gradually trend down towards 25 per cent in a five year period starting from 2019
- Group EBITDA-margin stable around 2017 level as a result of lower gross margin and OPEX% over time. In Norway around 20 per cent, in Sweden and Finland low double digits, in Denmark and Austria high single digits
- New market entries affect both Group gross margin and Group EBITDA-margin in the establishing period of 1-3 years.
For further information please find attached the quarterly report and the presentation material.
The results will be presented at 08:30 CET by interim CEO Tolle Grøterud and CFO Stein Eriksen. The presentation will take place at our headquarters in Oslo, Strømsveien 245, Alna Senter (entrance on the right side of Maxbo). The presentation will be held in English and will be webcasted at www.xxlasa.com. You may also follow the presentation live by telephone. Dial-in details: +47 21 56 33 18 (Norway) and +44(0) 20 3003 2666 (International), passcode – XXL Q1.
For further queries, please contact:
Tolle O. R. Grøterud
Interim CEO/Investor Relations
XXL ASA
Tel: +47 90 27 29 59
E-mail:ir@xxlasa.com
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act
About XXL ASA
XXL is a leading sports retailer with stores and e-commerce in Norway, Sweden, Finland, Denmark and Austria. It is the largest among the major sports retailers in the Nordics and the fastest growing among the major sports retail chains in the World. XXL pursues a broad customer appeal, offering a one stop shop experience with a wide range of products for sports, hunting, skiing, biking and other outdoor activities. XXL’s concept is to have the largest stores with the best prices and the widest assortment of products, focusing on branded goods.