MANGO turnover totals 2.26 billion euros with an EBITDA of 77 million euros in 2016
- The chain consolidates its position with the speed of the new retail model and already has 191 Megastores, 24 of which opened in 2016.
- The firm opened more than 57,000 new square metres in franchise stores last year.
- Online sales grow by 25.6%, to 294 million euros, representing 13% of total turnover.
- The store network at the close of the financial year comprised 2,217 stores with a total selling space of 798,000 m2.
- Positive evolution of the MAN, KIDS and VIOLETA lines, which now represent 17.6% of turnover.
- The result was a loss of 61 million euros due to the negative impact of the exchange rate and the implementation of the Business Transformation Plan:investment in the new chain of stores, promotion of the fast-fashion model and start-up of the new Lliçà d’Amunt logistics centre.
- The company forecasts a return to profit in 2017 and to obtain an EBITDA in excess of 150 million euros following the upturn in sales which began in the last four-month period of 2016.
- At the close of June 2017,compared to the same period the previous year, we managed to increase the EBITDA by more than 30 million euros and improve the result by more than 45 million euros. Both figures exceed the target set at the start of the current financial year.
Barcelona, 11 August 2017 – MANGO MNG Holding closed the 2016 financial year with sales of 2.26 billion euros.79% of MANGO turnover corresponds to international activity, and the remaining 21% to the domestic market.The financial year was divided into two very different periods:a first semester characterised by a weak market and a second semester with a notable improvement, a trend which has continued in the first few months of 2017. By business lines, highlights include the performance ofMan, Kids and Violeta, responsible for 17.6% of turnover, compared to 14.7% in the previous financial year.
The EBITDA of MANGO MNG Holding was 77 million euros, compared to the total of 170 million the previous year.This figure was affected by lower than expected sales during the first semester of 2016; owing to the implantation of a more ambitious fast-fashion model which initially reduced margins, and the negative behaviour of key currencies for the company: the revaluation of the US dollar and the depreciation of the Turkish lira and Russian rouble.Similarly, has maintained a strong rate of investment, continuing with the plan to transform its stores and meeting the start-up expenses of its new global logistics centre in Lliçà d’Amunt (Barcelona).These factors have resulted in a loss of 61 million euros.
Since September 2016, the evolution of the business has changed radically with a growth in turnover, suggesting a return to profit in 2017.
The figures obtained from January to June 2017 exceed the targets the company had set at the start of this financial year. Compared to last year, the result has improved by 45 million euros and the EBITDA has increased by more than 30 million euros.This major improvement is basically due to the consolidation of the new store format (megastores) and the optimisation of stocks associated with the new fast-fashion strategy, which allows the company to react faster and more efficiently to the needs of the market.
According to the Executive Vice-Chairman of MANGO, Daniel López:“In 2016 we have progressed in the process of transforming the business model of the company, which has resulted in a reduction in our EBITDA and, as a consequence, sacrificing the profit this year.The first results of this decision have been visible since September 2016 and give us optimism for 2017”. In the last twelve months, MANGO has also made progress in professionalising its management structure, strengthening its Executive Committee with the addition of new Directors in the areas of retail, product, customer relations and technology. “We have the right people for MANGO to remain among the group of large multinationals within the fashion sector”, López points out.
The success of Mango.com
Online sales continued to increase its relative weight within the group.This is why in 2016 the turnover of this channel rose by 25.6% compared to 2015 to reach the figure of 294 million euros, and now represents 13% of total Group turnover.This is an increase of 60 million euros compared to the previous year, when online sales accounted for 10.7% of total sales.MANGO has set itself a target that by 2020 e-commerce channel will reach 20% of total turnover.
MANGO sells through its online platforms in a total of 83 countries across all five continents, offering a shopping experience that is fully integrated with its physical stores.A key factor in the growth of the online business has been the commitment to improvements in the user-friendliness of the online platform, particularly in its mobile version, which in 2016 experienced a qualitative leap with an updated App, an even simpler payment procedure allowing one-click shopping and the redesign of the browser menu, among other improvements.At the same time, we have continued our commitment to excellence in the operations and services of the online platform with even faster delivery times, more options for returns and the inclusion of new payment methods in countries such as Germany, China and Turkey.
During 2016 the e-commerce website of the Group received a total of 397 million hits (54 million more than the previous year with an increase of 15.7%) and a total of 150 million single users (12.5% more).At the close of the year, more than 60% of traffic was via mobile devices.
Consolidation of the new retail model and growth in franchises
MANGO has implemented a process of consolidating its new retail model based on opening megastores while closing smaller stores.MANGO closed the 2016 financial year with 191 megastores, 24 of which opened last year.The average surface area of the megastores opened is 1,100 m2.
As for the total number of stores, at the close of the year the Group had 2,217 stores, after deciding not to renew the agreement with JC Penney in the United States, with whom MANGO had approximately 440 small selling spaces.
Since last November, with the opening of a megastore in Surinam, MANGO is present in 110 countries with a global selling space of 798,000 m2. During 2016, 57,000 m2 of new commercial space opened under the franchise system.At the close of 2016, the firm had a total of 1,167 franchises worldwide, accounting for approximately 52% of all the stores of the fashion multinational.During the 2017 financial year, it is forecast that the Group will continue to grow via this model and open 66,000 m2 of new franchise space.