May 11
NKD-Mode, Zentrale in Bindeach, Aussenansicht

NKD achieves turnaround with growth that outperforms the market

  • Sales increase of 5.3% in 2016 to EUR 680.6 million
  • Adjusted operating result (EBITDA) of EUR 20.4 million
  • 3% rise in store space productivity since 2013
  • Positive start to financial year 2017

Bindlach, 11 May 2017 – The discount clothing retailer NKD completed its economic turnaround in financial year 2016 and is growing profitably. Sales increased year on year by 5.3% in 2016 to EUR 680.6 million, achieving growth that outperformed the market. On a like-for-like basis, the company expanded sales by 5.5% year on year in 2016. As a result, NKD increased sales for the fourth consecutive year. In the past three years, it generated annual average sales growth of 7.5% (CAGR 2013 to 2016). The adjusted operating result, or earnings before interest, taxes, depreciation and amortisation (EBITDA), stood at EUR 20.4 million for 2016, which significantly surpassed the previous year’s figure of EUR 2.5 million.

“Our strategy pays off. NKD is on a sustainable track towards growth. It has successfully positioned itself as a neighbourhood store and value retailer, establishing its reputation as a provider of attractive goods at an affordable price,” says Dr Ulrich Hanfeld, CEO of NKD Holdings GmbH. “We will continue to systematically pursue this course of action. In our view, NKD harbours great potential for sustained profitable growth − in the past several years, we have continuously increased like-for-like sales. We have taken this momentum with us into the new financial year and continued the positive development at the start of 2017.”

Expansion of the complete clothing range

NKD has systematically expanded its range in the past three years and offers a wide variety of garments and accessories for the whole family. Regular promotions featuring beloved brands, such as the underwear collection of international footballer Cristiano Ronaldo, support current trends and appeal to new customer groups. The range also has a seasonal focus, providing added appeal to customers. As a result, store space productivity has risen by 24.3% since 2013.. “With our range, we specifically appeal to female customers who shop for the whole family and look for high quality at affordable prices. Continuously rising sales confirm our decision to offer them an attractive range of goods and an enjoyable shopping experience,” Hanfeld says.

Store network economically well positioned

Efforts to economically establish the store network have been under way since 2014. As a neighbourhood store, NKD is located in city centres as well as speciality shopping centres in small and medium-sized towns. Between 2014 and 2016, the discount clothing retailer opened 88 new stores at attractive locations in Germany. In the past financial  year, NKD added 54 more stores across its country portfolio. At the closing of financial year 2016, NKD had 1,778 stores in Central Europe, 1,300 of which were in Germany.

The store network has been modernised as well. NKD has improved the cash register systems at stores in Germany in the past several months, for instance.

“The hard work of the past few years is paying off. For the second consecutive year, NKD generated a positive operating result and significantly increased its profitability in 2016. We have managed our economic turnaround and can now grow sustainably  and profitably once more on our own,” said Rüdiger Hartmann, CFO of NKD Holdings GmbH.

NKD recruiting more staff

NKD had a headcount of around 8,000 people as at the end of the financial year on 31 December 2016. Of those employees, 6,417 worked in Germany. The company is continuously expanding its occupational educational offer. Since 2016, NKD has been offering a combined vocational training and degree programme for people in business studies with a focus on the textile sector, for people studying textile science and technology, and for people looking to become certified commercial specialists. NKD also offers a wide range of skilled occupations and is adding to its logistics and IT staff.