Zalando, the online fashion retailer, has revealed it expects to return to growth in H2 despite seeing a 58% drop in its Q2 operating profits to €77.4m (£64.7m), down from €184.1m (£153.3m) in the same period last year.
However, the Q2 performance marks a rebound from a Q1 loss of €52m (£43.5m) at the start of this year.
The Q2 report from 1 April 2022 to 30 June 2022 saw Zalando’s revenue fall by 4% to €2.63bn (£2.19bn) in Q2 2022 compared with €2.73bn (£2.28bn) in Q2 2021.
Its gross merchandise volume was flat at €3.78bn (£3.16bn) in the quarter compared with the same period last year.
Zalando confirmed H2 guidance was lowered in June, forecasting a sales increase between 0% and 3% and an adjusted EBIT of €180m to €260m (£150.7m to £217.6m).
Zalando cited that the “war in Ukraine has severely affected consumer confidence, with soaring energy and food prices”. It also mentioned that pandemic-related disruptions in China have “exacerbated existing supply chain pressures”.
Robert Gentz, co-CEO, said: “Life is becoming more expensive and consumers are reluctant to consume.”
Sandra Dembeck, CFO, added: “We are focused on efficiency and margin improvement measures that will help us strengthen our profitability in the second half of the year.”
The report found that its active customers grew by 11% on the year to over €49m (£41m), while the membership of its loyalty program, Zalando Plus, rose by 164% in the quarter to more than 1.5 million.