Zalando Revenue Will Double By The End Of 2020.

Europe's largest pure

Online retailers

SE (ZALG.DE) proposes to double revenue by the end of 2020 in today's capital market.

According to the world clothing and shoe net, the group achieved 3 billion 639 million euro income in fiscal year 2016, up 23% from the same period last year. The Group expects the growth of 20%-25% in the current fiscal year.

Now Zalando SE first set out the medium-term target, and joint CEO Rubin Ritter said in Berlin that revenue would reach 7 billion 200 million euros in 2020, but this is still less than 7 billion 600 million euros expected by Thomson Reuters composite analysts.

Investors were encouraged by the medium-term goal, and Zalando SE (ZALG.DE) shares rose by 3% to 44.74 euros at the end of Monday, closing on the 52 week high of 44.99 euros.

To improve the slow growth of revenue in recent years to meet the high expectations of the market, Zalando SE has focused on one of its strategies in B2B business.

Last Friday, the group announced Nike

New brands such as Hennes&Mauritz AB (HMb.ST) and Weekday will be launched in 2010 to launch the "Partner Program (cooperative plan)". Through the Zalando SE role of the trading platform, the third party brands will manage their inventory, image and sales, and Zalando SE will earn commission. Now the plan has expanded to 11 markets, attracting 170 partners and more than 300 brands.

David Schr Schr der, the group's chief operating officer, said: "(the plan) made Zalando a shopping center, enabling it to differentiate itself from the world's largest e-commerce provider, Amazon.com Inc. (NASDAQ:AMZN).

Zalando strengthening warehousing and logistics capabilities

Since its establishment in 2008, Zalando SE has been dominated by self-management. At present, wholesale business accounts for 90% of the group's revenue and the profit margin of EBIT is 10%.

Birgit Opp, senior vice president in charge of finance, said the profit margin of the third party brand business would be higher than that of the wholesale business.

Under the multiple efforts of expanding the third party brand business, continuously improving logistics warehousing capacity and improving technology, Birgit Opp pointed out that the ultimate goal of Zalando SE is to achieve 20 billion euros in revenue.

With the completion of new warehouses in Sweden and Berlin, the group will have 8 logistics centers in Europe, with the ability to handle 8 billion euro sales.

The group is also making use of this huge Pan European logistics network to generate revenue. The group disclosed that Bestseller A/S, the parent company of Vero Moda and Jack&Jones JACK&JONES, has become the first major customer of its logistics service, which will pay Zalando SE to handle its warehousing, order fulfillment and return operations.

Bestseller A/S bestseller group boss Anders Holch Povlsen is the major shareholder of Zalando SE. According to the data, he holds 10% of the shares.

In addition, the German shoe retailers Schuh.de and Tommy Hilfiger open 4 stores in Berlin will store the physical stores on the Zalando website.

Zalando SE three founders Rubin Bitter, David Schneider and Robert Gentz

At present, the Zalando SE provides 1500 brand products in 15 European markets. By the end of March this year, the number of active users exceeded 20 million for the first time, leaving Britain's ASOS PLC (ASC.L) with the advantage of over 5 million.

Birgit Opp pointed out that the growth of the group came mainly from the number of users and their average consumption. He said that there were 420 million people in Europe, and their annual consumption of online shopping reached 1000 euros, and the annual consumption of Zalando users was between 200-250 euros.

According to statistics, Zalando SE recorded an income of 980 million 200 thousand euros in the first quarter, up 23.1% from 796 million 100 thousand euros a year earlier, narrowing by 26% compared to 24% in the same period last year and 26% in the four quarter.

The core market grew by 17% in Germany, Austria and Switzerland, while 28% in other parts of Europe.

The adjusted EBIT rose to 20 million 300 thousand euros from 20 million 200 thousand euros in the same period last year, which is basically in line with market expectations.

However, the adjusted EBIT profit margin dropped by 40 basis points to 2.1%, of which the core market's profit margin shrank by 220 basis points to 7.5%, while other European markets still failed to make profits.

Net profit increased 10.9% to 5 million 100 thousand euros compared with the same period last year.

Zalando SE still maintains annual revenue growth of 20%-25% and adjusted EBIT profit margin is expected between 5.0%-6.0%.

ASOS PLC raised its annual revenue forecast in April, and its profit outlook remained unchanged.

Zalando SE (ZALG.DE) reported 44.73 euros on Monday, an increase of 2.97% throughout the day, extending the cumulative increase to 23.11% in 2017. In the past 12 months, the stock rose more than 73%, while ASOS PLC (ASOS.L) increased by 78.6%, showing investors' confidence in the electricity supplier industry.

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