Douglas safely navigates through corona crisis - record growth in e-commerce

• Corona-related sales drop by 7.5 percent in the first nine months of the fiscal year
• Upward trend in June with sales increase compared to same month last year
• E-commerce totalled 640 million euros and 40 percent growth in the nine-month period; 70 percent increase alone in the third quarter
• Significant upward trend in store business since reopenings following the end of the lockdown
• Market share in core markets rises – in both online and offline business
• Tina Müller, Douglas Group CEO: “We focused on the e-commerce business at an early stage as part of our #FORWARDBEAUTY strategy. Along with our ability to adapt and cost discipline, we have safely navigated Douglas through the corona crisis.”

Düsseldorf, 13 August 2020. Douglas, one of Europe’s leading premium beauty retailers, has stabilised its sales following a weeks-long  period  in which the global  coronavirus pandemic  has significantly  impacted  the retail industry. After seeing sales declines in March, April and May as a result of government-ordered store closures, the company generated year-on-year growth in sales again in June. Consolidated  Group sales for the first nine months of fiscal year 2019/2020  totalled  2.5 billion  euros, a drop  of only 7.5 percent compared with the  previous year’s level. In the same period,  sales of the store business fell by 17.2 percent year-on-year.  By contrast,  Douglas’ e-commerce business jumped by 39.6 percent, partially offsetting the impact on earnings. Strict cost discipline and consistent liquidity management also helped the company to achieve this result. Due to the decline in sales, adjusted EBITDA decreased by 10.6 percent to 264 million euros year-on-year. However, even during  the corona crisis, Douglas continued  to expand its market share in the core markets of Germany, France, Spain, and Italy – both online and offline.

Tina Müller, Douglas Group CEO: “I am proud of the entire team’s performance. Working together, we have safely navigated Douglas through the crisis. Our fast and resolute crisis management, our strict cost discipline, and the early digitalisation of the company in line with  our  #FORWARDBEAUTY strategy  had  a clear impact.  When  we launched  this strategic programme,  we focused on e-commerce from the very beginning. We are now profiting enormously from this decision. We have broadly  expanded  our position  as a leading premium e-commerce provider and could offset partially the drop in sales from our stores. We have now reopened  most of our stores across Europe and saw already again a clear upward trend in our store sales in June.”

 Strong growth in e-commerce even after store reopenings

During the first nine months of fiscal year 2019/20, Douglas generated e-commerce sales of  640  million  euros,  an  increase  of  39.6  percent  year-on-year.   “The  coronavirus pandemic has radically and permanently changed consumption  behaviour. Even before the corona crisis began, there was a shift towards online retailing  – the pandemic  has accelerated this trend even further,” says Vanessa Stützle, Douglas Group CDO.  “In the third quarter, our e-commerce business increased by 70.3 percent year-on-year, and the number of new customers even rose by over 90 percent. We are also really pleased to see that this momentum  has continued  even after stores reopened.  We assume that today we are already generating  about three times the amount of online sales that our nearest competitor is generating  in Germany. We are approaching the 1 billion  euros sales mark in e-commerce with great strides.” During the  first nine months of the  fiscal year, Douglas generated  25.6 percent  of its total sales online.  In its home  market of Germany, the number came to as much as 39.9 percent.

Douglas maintains robust liquidity reserves

Douglas remains committed to consistent liquidity  and cost management  to offset the impact of the coronavirus pandemic  on its business operations.  On 30 June 2020, the company  held  robust  liquidity  reserves of 339 million  euros. Free cashflow totalled 29 million euros in the third quarter, another year-on-year increase. At 3.9 million euros, the company’s net profit for the first nine months of the fiscal year was positive.

Successful reopening of nearly all stores in Europe

Following the end of government-ordered store closures, Douglas has reopened  nearly all of its 2,400 stores in Europe in compliance with official regulations and hygiene measures. The number of customers in the stores has risen since April when the easing of restrictions began. Store sales showed a sharp upward trend, particularly in June. Sales approached the previous year’s level despite some still limited opening hours.

Against the background of the changed consumer behaviour, Douglas announced plans in June to  develop  a future  concept  for  its European  store  network.  The company originally  planned  to present the concept during late  summer. But the  company’s Management  Board has now decided  to expand the analytical period  for two reasons. First, it wants to be able to make a sound, responsible decision about the future potential of  every  individual   store  in  various  countries.  Second,  it  wants  to  determine   how extensive the new form of consumer behaviour is during the crucial Christmas business. The concept is now expected to be presented at the beginning of 2021.

 

ABOUT DOUGLAS:

Douglas  is one  of the leading  multichannel  premium  beauty  retailers  in Europe  with  about

2,400 stores and a unique e-commerce platform that is currently being expanded into a curated beauty marketplace. The #FORWARDBEAUTY strategy defines the path into the future of omnichannel  retailing.  Already  today  Douglas  is the  number  one  beauty  destination  in  26 countries, offering  its customers an attractive portfolio of around 55,000 high-quality  products from over 750 brands in the fields of perfumery, decorative cosmetics and skin care, as well as nutritional supplements and accessories. Douglas generated sales of 3.5 billion euros in fiscal year

2018/2019. Around 20,000 beauty experts encourage and inspire Douglas customers every day to live their own kind of beauty.

# d o i t f o r y o u

PRESS CONTACT:

Eva Krüger

Corporate Communications Manager

Telephone: +49 211 16847 6644

E-mail: e.krueger@douglas.de