The Polish footwear company CCC posted sales of 1,429 billion zloty (€313.9m-$381.8m) in the first quarter running from February to April, up by 85 percent from a year earlier, when business was affected by the outbreak of the Covid-19 pandemic. The top line is also nearly PLN 300 million (€65.9m-$80.2m) higher than in the same period in 2019.
The group’s physical retail business enjoyed a 78 percent increase to PLN 469m (€103.0m-$125.3m), with the brick-and-mortar retail division of the CCC banner up by 77 percent to PLN 449m (€98.6m-$120.0m), with like-for-like sales up by 79 percent. Comparable sales for CCC stores open during the pandemic surged by 161 percent. The figures for the CCC business include the Gino Rossi brand. Store sales of the eobuwie banner were up by 73 percent to PLN 19m (€4.2m-$5.1m) and the remaining PLN 1m (€0.22m-$0.27m) was generated by HalfPrice’s sole location at the time.
HalfPrice is a new retail chain launched by the group, specializing in off-price goods. It offers clothing, footwear, accessories, cosmetics, toys, as well as home furnishings. Five stores were opened on May 4 in Poland. A further five openings are scheduled during the month of May and by the end of 2021 HalfPrice will have a network of nearly 60 stores in Poland. The banner also plans to have an online shop in the autumn.
The development of HalfPrice stems from the decision, under the GO.22 business plan, to trim the number of CCC stores as well as reducing the size of the format to 500-800 square meters. The stores freed up are being transformed into HalfPrice outlets with the aim of increasing revenue per square meter.
As of April 30, CCC had 979 stores, down from 1,021 a year earlier, eobuwie had 25 locations, up from 22. The group closed down all Gino Rossi stores, the brand now being sold through CCC and eobuwie’s physical and digital channels.
The CCC group’s e-commerce sales were up by 86 percent to PLN 893m (€196.2m-$238.6m) and representing 62 percent of overall revenues. The eobuwie unit represented the lion’s share of the digital business, with revenues up by 79 percent to PLN 741m (€162.8m-$200.7m), of which PLN 97m (€21.3m-$25.9m) stemming from the Modivo brand,up by 185 percent. Gino Rossi’s online sales are combined with eobuwie’s. The CCC brand posted a 146 percent jump in online sales to PLN 128m and DeeZee saw a 71 percent rise to PLN 24m.
Group wholesale sales grew by 148 percent to PLN 67m (€14.7m-$17.9m). The amount includes PLN 33m of sales (€7.3m-$8.8m), up by 83 percent, to Karl Vögele AG (KVAG), the Swiss retail chain CCC has decided to sell to focus on Central and Eastern Europe (CEE).
The first-quarter gross margin for the CCC group widened to 43.5 percent from 43.0 percent leading to a reduction of the operating loss to PLN 95m (€20.9m-$25.4m) from PLN 288m a year earlier. The group swung to a positive Ebitda of PLN 59m (€13.0m-$15.8m) from a negative PLN 142m. The improvement in operating margins was achieved by cost containment, resulting in distribution, administration and other expenses rising by only 15 percent, nearly six times less than revenues and gross profit.
The group also released a breakdown of the quarterly results of the eobuwie unit, whose total revenues grew by 79 percent to PLN 768m (€168.7m-$205.2m), including Modivo’s contribution. The company’s sales rose by 59 percent in Poland, by 83 percent in CEE, by 63 percent in Northern and Western Europe and by 170 percent in Southern Europe.
Eobuwie’s gross margin widened to 42.3 percent from 41.3 percent, the Ebitda margin to 10.5 percent from 6.1 percent and the Ebit margin to 8.6 percent from 3.7 percent.