Stockmann's outlook for 2019
Half year financial report 2019, published 9.8.2019:
In 2019, the retail growth is estimated to decline somewhat due to economic slowdown in Finland, but modest growth is expected to continue in Sweden (source: Federation of Finnish Commerce, HUI Research). In the Baltic countries, the outlook for the retail trade is expected to be better than that for the Stockmann Group’s other main market areas (source: OECD).
Purchasing behaviour is changing due to digitalisation and increasing competition. E-commerce is expected to grow steadily, but the development in brick and mortar continues to be challenging. The retail industry is facing major structural challenges through digitalisation and further globalisation.
Stockmann has reworked its strategy with the aim of creating a sustainable business model that enables profitable growth and strengthens the company’s position and competitiveness. The aim is a cost reduction of at least EUR 40 million by spring 2021, of which a major part would be visible as soon as in the 2020 results.
Reported EBITDA and the operating profit will also improve due to a change in accounting principles when the new IFRS 16 Leases standard was taken into use as of 1 January 2019. The Group applies the standard using the modified retrospective approach, which means that the comparative figures for 2018 are not restated.
Capital expenditure for 2019 is estimated to be approximately EUR 35 million.
Guidance for 2019
Stockmann expects the Group’s adjusted operating profit, excluding Nevsky Centre but including the impact of IFRS 16, to be on a par with 2018.