Nov 23, 2016
Challenging emerging markets hit Rocket's Global Fashion revenue
Nov 23, 2016
Revenue growth at emerging markets-focused retailer Global Fashion Group (GFG), which is backed by investors Kinnevik of Sweden and Germany's Rocket Internet, slowed in the third quarter, although its losses narrowed.
GFG said on Wednesday net revenue in constant currency terms rose by 16 percent to 250 million euros ($266 mln) in the quarter, less than half the 36.6 percent rise it achieved during the first half of the year.
The retailer is one of three Rocket investments, along with food delivery companies Delivery Hero and HelloFresh, that the ecommerce investor has cited as having the highest potential for eventual stock market listings.
Kinnevik held a 35 percent stake in GFG at the end of September, while Rocket held 20.4 percent as of Sept. 15.
Revenue was hit by macroeconomic challenges in Latin America, Middle East and Russia, GFG said in a statement.
However, adjusted earnings before interest, taxes and depreciation narrowed to a loss of 32.3 million in the latest quarter from a loss of 54.0 million euros in the third quarter of 2015. Core earnings margin improved to negative 12.9 percent from negative 14.8 percent in the first half of 2016, it said.
These results excluded businesses GFG divested including its struggling Jabong unit in India and operations in Thailand and Vietnam. This boosted its cash balance to 284 million euros in the third quarter from 64.3 million euros a year earlier.
Net merchandise value rose to 255.2 million euros in the third quarter from 192.1 million euros in the year-ago quarter.
($1 = 0.9408 euros)
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