Ceconomy remains confident despite loss

German electronics retailer Ceconomy has gained confidence through positive Black Friday sales and sees a favourable run-up to Christmas.

What happened

Ceconomy saw its sales rise by 4.7% to 22.2 billion euros in the financial year 2022/23, but the share of online sales fell 2.5 percentage points to 22 %. Still, the retailer expects this to rise again to 30 % by financial year 2025/26. Sales in physical shops rose 6.6 % to 16.9 billion euros.

Why it matters

Thanks to cost savings, the group’s adjusted EBIT rose from 208 to 243 million euros, but the electronics retailer still ended below zero in terms of net profit. This was due to a write-down on its stake in French competitor Fnac Darty, the sale of its Swedish and Portuguese operations and restructuring costs.

CEO Karsten Wildberger therefore says he is not alarmed: he says he noted a “strong growth” in a challenging market environment. Recent Black Friday discounts gave Ceconomy a positive start to the new financial year and the run-up to Christmas is also going well. He expects a slight revenue growth and a significant increase in operating profit thanks to further operational improvements in the new financial year.

Ceconomy is increasingly focusing on services, further expanding its marketplace and modernising its shop network, merging the MediaMarkt and Saturn brands. The group is also simplifying and streamlining its internal organisation, which should lead to significant savings.

This news brief is based on reporting published by RetailDetail on 2023-12-18. The original report is linked below.