Status: 07.02.2022 10:59 a.m
The Christmas business did not meet the expectations of the electronics retailer Ceconomy with the Media Markt and Saturn chains. The reason is the bad mood among consumers and the pandemic.
Europe’s largest electronics retail chains Media Markt and Saturn posted significant declines in sales and profits in the Christmas business. Revenues shrank in the first quarter of the 2021/22 financial year, which begins at the group in October, from EUR 7.5 billion in the same quarter of the previous year to EUR 6.9 billion. This was announced by the owner of the two chains, the electronics retailer Ceconomy.
This puts a damper on the start of the Group’s new financial year. Online sales also fell – by 16.5 percent to 1.9 billion euros. The adjusted operating result fell from 346 million to 274 million euros. The bottom line is that Ceconomy earned around 20 percent less than in the same period of the previous year at 122 million euros.
Restrictions imposed by the 2G rule
In the 2020 Christmas business there was a special boom due to the temporary suspension of corona restrictions. Many consumers made intensive use of the opportunity to shop. That was not the case last year: stationary trade was burdened by restrictions, such as the 2G rule in countries like Germany and Austria. According to Ceconomy, these would have led to significantly lower customer frequencies.
In the Netherlands and Austria there were also temporary store closures. In countries without restrictions, Ceconomy has had “stable” business, such as in Italy.
Added to this was a declining consumer mood, which also suffered from the high inflation rate. Finally, Ceconomy faced bottlenecks in the international supply chains. Although the company increased its stocks early on, the demand for certain products such as tablets or smartphones could not be met.
Forecast confirmed, share collapses
Ceconomy confirmed his outlook. The group continues to expect a slight increase in sales and a very significant improvement in the operating result. “We should all be prepared for a certain volatility, that’s just part of the new normal,” explained CFO Florian Wieser. As soon as there was more clarity about the framework conditions, Ceconomy would make the forecast more precise.
Investors reacted to the annual report with strong share sales. According to one market participant, the electronics retailer performed worse than expected across the board. Volker Bosse, an expert at Baader Bank, believes that the financial year got off to a weak start. According to the expert, the confirmed targets for the financial year are subject to many uncertainties.