Global Fashion Group (GFG) Q2 2024 earnings summary

Executive summary

• Q2 2024 saw continued operational changes and cost discipline, resulting in improved adjusted EBITDA margin, record gross margin, and break-even normalized free cash flow despite subdued demand and a slower decline in active customers and NMV.

• Revenue declined 15.6% year-over-year to €337.5m in H1 2024, reflecting macroeconomic headwinds and weak consumer sentiment.

• Loss for the period from continuing operations improved to €57.7m from €81.6m in H1 2023, driven by cost reductions.

• Management remains focused on profitability, cash flow, and operational efficiency amid ongoing market volatility.

Financial highlights

• Q2 2024 NMV was €285m, down 12.3% year-over-year; gross margin reached a record 45%, up 3.5ppt year-over-year due to reduced discounting and improved inventory management.

• Adjusted EBITDA margin improved by 6 percentage points year-over-year to -2.1%, with cost and productivity initiatives offsetting revenue declines.

• Active customer base at quarter-end was 8.1 million, with 4.4 million orders and an average order frequency of 2.3; average order value increased by 5.5% year-over-year.

• Revenue declined 13% year-over-year on a constant currency basis in Q2 and 15.6% in H1 2024.

• Loss before interest and taxes (EBIT) improved to €51.0m from €73.9m loss.

Outlook and guidance

• Full-year 2024 guidance reaffirmed: NMV expected to decline 5–15% year-over-year on a constant currency basis; adjusted EBITDA loss projected between €25m and €45m.

• June and July were the strongest months of the year in terms of year-on-year NMV trends, supporting confidence in guidance.

• Management remains cautious for H2 due to seasonality, peak trading risks, and subdued demand expected to persist into 2025.

• Focus remains on platform transition, inventory efficiency, and further cost reductions.