Wolford first half sales dip again, but Q3 offers hope

Hosiery label Wolford reported revenue of €67.62 million ($70.6 million) for the first half of the year ending October, down 14.7% on the previous year. When adjusted for currency effects, revenue dropped 13.1% due to the weakness of sterling.

The company said revenue for the second quarter shrank 11.9% to €39.88 million (or $41.6 million) as a result of weaker footfall and the delayed delivery of its Autumn/Winter collection, which resulted in €3.19 million not being included in first quarter results.

Another delivery was delayed in the second quarter, which explains the €3 million drop compared with the prior year’s period. Overall, the company’s wholesale business declined by 20% in the first six months of the financial year.

Wolford’s retail sales also struggled with a significant drop in the period. Sales were down 12% on a year-on-year basis, which the company attributed to weak footfall figures and the challenging market conditions in Europe during August and September.

Fashion sales in Germany declined 3% in August and 12% in September compared with last year, said Wolford.

The brand’s EBIT loss for the six months widened to €8.24 million (about $8.61 million) from €0.28 million in the previous year. Adjusted EBIT was €6.87 million below the comparable figure in 2015.

Despite the results, Wolford remains confident. The brand said retail sales grew again in November and expects the wholesale business to see an improvement in the third quarter.

Wolford left its full-year guidance unchanged, forecasting a slight drop in revenues and negative operating earnings in the low single-digit range, as it said its strategy to increase its profitability is starting to show signs of progress.