Adolfo Domínguez losses narrow by 32% after third quarter

Adolfo Domínguez lost 2.1 million euros ($2.3m) in the first nine months of the year ended November, an improvement from losses of 3.2 million euros a year earlier, according to company accounts. Sales increased 1% to 76.6 million euros ($85m).

On a comparable basis (excluding store openings, closures, restructures and changes to store management), sales increased by 5%, with growth across all 22 markets where the Spanish brand has a presence. 

In Japan, comparable sales were up 8.9%, in Mexico revenues jumped 7.1% and in Europe (including Spain), like-for-like sales increased 4.4%.

Ebitda profit was 5.5 million euros ($6.1m), compared to an Ebitda loss of 1.1 million euros a year earlier, partly boosted by the effect of a new accounting standard, the report submitted to Spain’s Companies House showed.

Meanwhile, gross margin, which measures the gross difference between income obtained from each sale and associated costs, fell by almost two basis points to 58.58%.

Adolfo Domínguez attributed the decrease to unfavourable currency effects and inventory write-offs.

“We are a company focused on profitability. We have strived to manage and improve [the business] which allowed us to make an additional 3.5 million euros in sales despite the closure of 130 stores in the past three years,” said CEO Antonio Puente, in a statement.

According to the same source, Adolfo Domínguez continues to optimise its national and international store portfolio with the opening of 21 new stores in five countries in the period between March and November 2019.

Ten stores opened in Mexico, five in Spain, two in Portugal, one in China and a further location launched in Russia during the period.

The report also highlighted a 3.5% increase in comparable sales in Spain in the first nine months of the year, outperforming the wider industry’s growth of 1.5%, according to data from the Business Association of Textile (Acotex).