Zalando: shares down as investment ramps up
(CercleFinance.com) - Shares of German online fashion retailer Zalando are currently down almost 5% after the publication of the group's full-year 2017 results.
Analysts at Bryan Garnier noted that fourth-quarter sales growth was "slightly below expectations."
Zalando saw group revenue rise by 22.2% in fourth-quarter 2017, well below the 25.7% growth it recorded in the fourth quarter of 2016.
However, investors also seemed to focus on the Berlin-based firm's investment ramp-up, due to new fulfilment centres throughout Europe.
After capital expenditure of 243.9 million euros in 2017, primarily on the group's logistics infrastructure, increased automation and in-house developed software, capex is expected to be around 350 million euros in 2018, excluding M&A.
"The 2018 outlook given by the management implies that strong investments will continue to be allocated to fuel growth, including the opening of new fulfilment centres and the potential entry into new markets which we believe concerns Russia and another Eastern European country", Bryan Garnier commented.
Zalando's trading update failed to lift the share price, which is currently down 4.7% this morning, largely underperforming the German market, which is down 1.5%.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
Analysts at Bryan Garnier noted that fourth-quarter sales growth was "slightly below expectations."
Zalando saw group revenue rise by 22.2% in fourth-quarter 2017, well below the 25.7% growth it recorded in the fourth quarter of 2016.
However, investors also seemed to focus on the Berlin-based firm's investment ramp-up, due to new fulfilment centres throughout Europe.
After capital expenditure of 243.9 million euros in 2017, primarily on the group's logistics infrastructure, increased automation and in-house developed software, capex is expected to be around 350 million euros in 2018, excluding M&A.
"The 2018 outlook given by the management implies that strong investments will continue to be allocated to fuel growth, including the opening of new fulfilment centres and the potential entry into new markets which we believe concerns Russia and another Eastern European country", Bryan Garnier commented.
Zalando's trading update failed to lift the share price, which is currently down 4.7% this morning, largely underperforming the German market, which is down 1.5%.
Copyright (c) 2018 CercleFinance.com. All rights reserved.