SMCP swings to full-year loss, remains upbeat on China recovery

French premium fashion group SMCP swung to a full-year loss in 2020 as its operations were impacted by the pandemic, but it remained upbeat on its recovery in China and strong digital sales.

The group, whose portfolio includes brands Sandro, Maje, Claudie Pierlot and De Fursac, reported a net loss of 102.2 million euros for the year, compared to a profit of 43.7 million euros a year earlier. However, when excluding Goodwill and right of use impairments, that loss narrowed to 39.6 million euros.

The company’s adjusted EBITDA dropped 37.3 percent to 179.6 million euros. Breaking it down by brand, Sandro reported EBITDA of 91.8 million euros, down from 141 million euros a year earlier, while Maje reported EBITDA of 75.2 million euros, down from 119.9 million euros. The company’s other brands made EBITDA of 12.6 million euros, down from 25.4 million euros.

Global store closures take toll on revenue

Sales for the year fell 22.9 percent on a reported basis to 873 million euros as the company, like so many others, took a big hit from the pandemic. As of today, 33 percent of SMCP’s stores are temporarily closed worldwide.

CEO Daniel Lalonde said in a release: “As expected, our full-year results were strongly impacted by the pandemic which led to lockdown measures in most countries and a halt in tourism flows. Nevertheless, the group demonstrated its reactivity by immediately implementing strong measures on costs and boosting e-commerce which enabled us to limit the impact.”

The group saw a strong performance in mainland China, where sales were up 3.4 percent for the whole year and up 24.5 percent in the second half.

Additionally, it reported a strong performance in its digital business which saw sales growth of 27.6 percent for the year.

Lalonde continued: “We announced at the end of the year a new strategic plan that will shape our brands to the new world. SMCP is well-positioned to seize all market’s growth opportunities and I am confident in our talented teams to pursue our journey towards making SMCP a global leader in the accessible luxury market.”

The company said it wouldn’t provide guidance for full-year 2021 at this time “given the high level of uncertainty”.

Image: Maje