The shoe industry was expecting an indication of who will be its new owners around this time of the year, but Friedrich Metzeler, the highly paid bankruptcy trustee of Garant Schuh + Mode, is now indicating that the change of ownership will probably not be announced until the beginning of next year. The banks have agreed to continue financing its operations until then, and Metzeler has publicly guaranteed the respect of any outstanding request for damages and any claims being made by Garant’s creditors at the time of change of ownership.
More about that should come out at a press conference in Düsseldorf on Sept. 12, where newly audited and adjusted figures about the 2004-05 financial year are to be announced. Meanwhile Garant’s management is confident that the buying group will reach a positive operating profit (EBIT) of about €5.1 million this year on central settlements of €780 million. It will probably still make a net loss because of charges related to its current insolvency proceedings.
For the 6-month period ended last May 31, Garant reports a sharply reduced net loss of €1,306,600, compared with a loss of €7,738,300 in the same period a year earlier. The pre-tax profit before extraordinary charges was still negative at €1,060,100, but it was down from €3,405,900 and came after financial charges of more than €4 million. Personnel costs remained rather stable at about €2.8 million, as the average number of employees decreased only slightly to 97 from 109 in the comparable period of a year ago, but other operating costs were slashed down to less than €6 million. The result was an operating profit (EBIT) of €2.51 million against a loss of €4.31 million in the year-ago period.
Centralized settlements increased by 15.0 percent to €363.6 million, with an encouraging 10.9 percent increase in Germany to €133.4 million. France was off by 7.8 percent to €15.9 million, but Holland was up by 17.9 percent to €97.2 million and even higher increases were recorded in Belgium, Austria and Switzerland. The drop in France was due to the loss of a central settlement contract with SED, the sporting goods buying group that trades under the Twinner banner. Garant has agreed to sell its 49 percent stake in SED back to that cooperative, which is now planning to work closely with Intersport on purchases.
Numerous suppliers are evidently placing their trust again on Garant, although the number of its affiliated retailers in 14 European countries has fallen from 4,000 to 3,600, operating about 5,300 shops. According to Schuhkurier, the number of suppliers doing business with Garant has increased by 148 to 2,070 since the beginning of this year.