LPP's net profit down by 37% in 2009

2010-02-23

The Polish clothing group LPP, the owner of the Reserved, Cropp, Esotiq, House and Mohito brands, turned over around PLN 2bn (€500m) and made a net profit of PLN 106.2m (€26.5m) in 2009, whereas the previous year’s figures were PLN 1.62bn (€404.7m) and PLN 167.5m (€41.8m) respectively, reflecting a 23% increase in sales revenues and a 37% year-on-year reduction in net profit.
In the fourth quarter of 2009 the company earned sales revenues of PLN 543.6m (€135.8m) and made a net profit of PLN 83.5m (€20.8m), reflecting increases of 3% and 13% respectively. These healthy Q4 results reflect the opening of new establishments, as there was a 20.5% reduction, in the last quarter of 2009, in the sales of those stores which had been operating for more than 12 months.
In 2010, the company expects its sales to be similar to those of 2009. In order to improve its net profit, the group plans to increase its profit margin to 60% and to keep costs to the 2009 level. The company’s retail area will be expanded by 14% to 328,000 m², allowing it to open 80 outlets (at the end of 2009, the group was managing 841 establishments). The amount invested is thought to be PLN 75m (€18.7m). The group is not planning to acquire any new companies or to introduce any new brands in 2010.