EANS-News: Wolford AG / Comprehensive transformation after significant annual loss CNE

Thursday, 23. July 2020 08:25
  Corporate news transmitted by euro adhoc with the aim of a Europe-wide
  distribution. The issuer is responsible for the content of this announcement.

•	Downturn in revenues and earnings due to coronavirus crisis
•	New Management Board team focuses on comprehensive 
        transformation, first positive results already visible

Annual Result

Bregenz, 23. 07. 2020 - Wolford AG, which is listed on Vienna Stock Exchange,
has published today their annual financial statement for the fiscal year 2019/20
(May 2019 to April 2020).

Wolford AG generated revenues of EUR 118.5 million in 2019/20, registering a
fell in revenue of 13.6% compared to the previous year figures of EUR 137.2
million. The strong lockdown measures and the restrictions imposed on travel due
to the global pandemic had a decisive impact on all luxury sales particularly in
the months of March and April 2020, when Wolford´s revenue fell by around 60%.

The new Management Board, which took up their roles in the fall of 2019, has
promptly reacted by implementing a crisis response to include short-time working
plans, as well as, since the end of March 2020, the conversion of part of their
facilities to accommodate Care Masks' production, to meet the increased
worldwide demand, a move that has certainly cushioned fall in other revenues.

The socio-economic developments have clearly left their mark on the company's
earnings. Operating earnings (EBIT) fell from EUR -9 million in the previous
year to EUR -28.7 million. The loss after taxes amounted to EUR -27.42 million
(2018/19: EUR -11.10 million).

However, due to the first-time application of the new IFRS 16 lease accounting
standard, Wolford reports a decrease of their operating expenses by EUR 16.3
million to EUR 37.81 million.

The substantial loss reported for the past financial year is also reflected in
the balance sheet, despite the successful sale of the company's property that
will be reflected in the financial statements of Wolford AG for the current
2020/21 financial year. This non-recurring income will be stated as an
accounting gain of around EUR 49 million.

New Management Board enforces transformation

In the first weeks of their activity, the new Management Board, Silvia Azzali
and Andrew Thorndike, who took up their roles in the fall of 2019, kicked off a
compelling program to reshape the business, through the "Program for Immediate
Top and Bottom Line Impact" ("PITBOLI") that includes the international store
portfolio rightsizing, reducing rental payments, optimizing purchasing and
procurement, and consistently enhancing efficiency in production and logistics.
One key supplementary measure is the 50% reduction of the Time to Market.
Wolford aims to bring already its next spring/summer collection to the consumer
in a significant shortened time frame.

Wolford made substantial investments in technology and staff for its online
business, extended its distribution channels with additional sales partners, and
restructured its design, marketing, and sales teams. Furthermore, the product
portfolio has been streamlined, with key foundations being laid to extend the
core Wolford brand.

"Despite the severity of its impact, the coronavirus pandemic was and still is
not an excuse for us", underlines Andrew Thorndike, COO of Wolford. "We stress
tested the PITBOLI program, revisited and adjusted all initiatives in terms of
their effectiveness and timing, and will now consistently push forward
implementing them."

The increased digitalization during the mandatory lockdown has provided Wolford
with new opportunities to further enhance its efficiency. By the end of April
2020 the company´s online sales exceeded a like for like growth of 41%, the June
revenues were even at 54 % compared to last year and representing now more than
30% of the total revenue.

The Management strongly believes that the structural transformation the fashion
industry has witnessed during the last months will further and drastically
intensify in the near future.

"I strongly believe that there is a silver lining in all difficult situations.
This pandemic era has given us the opportunity to review and streamline our
Brand Architecture not only to help our consumers access and relate to the brand
but to better guide the development of new products in the near future and
expand our business into new segments" Silvia Azzali, Wolford CCO explained. "We
will boost our digital presence and international expansion, focusing on the
Brand's DNA and values, including a strong push to our commitment to


The effects of the crisis were still clearly visible in May 2020, with a
reduction in revenues of around 50%. This was due mainly to the fact that the
reopening dates for individual boutiques varied widely from country to country.
The boutiques in Austria, Germany, and Scandinavia were able to gradually reopen
in the weeks from mid-April already, while those in France, Italy, Spain, and
North America only reopened from the end of May onwards, and in some cases only
from the end of June.

Wolford plans to return to profitability on an operating level in 2021. "By
selling the company´s property in Bregenz, Wolford AG has gained the flexibility
needed to shape its own future. This is our opportunity - and we intend to seize
it," emphasized the new Management Board in the Foreword to this year's Annual
Report. In the interests of efficiency, this year's report has been limited to
the key information required by shareholders.

The 2019/20 annual financial statements can be downloaded from the Investor
Relations section of the company's website at: company.wolford.com.

Further inquiry note:
Wolford AG
Madeleine Dubois
Vorstandsbüro / Corporate Press Coordinator
Tel: +43 5574 690
investor@wolford.com / company.wolford.com

end of announcement                         euro adhoc

issuer:       Wolford Aktiengesellschaft
              Wolfordstrasse 1
              A-6900 Bregenz
phone:        +43(0) 5574 690-1258
FAX:          +43(0) 5574 690-1410
mail:         investor@wolford.com
WWW:          http://company.wolford.com
ISIN:         AT0000834007
indexes:      ATX GP
stockmarkets: Frankfurt, New York, Wien
language:     English

EAX0003    2020-07-23/08:25

Related Links: Wolford AG
Ad-hoc-Mitteilung übermittelt durch euro adhoc.
Für den Inhalt ist der Emittent verantwortlich.