I wonder if XXL will still be able to secure financing to continue its operations? Or could we even end up in a situation where they start closing the largest stores and selling off inventory to competitors at a discount just to generate enough liquidity to cover essential expenses?
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Last week, all Nike products were -40%, and this week the same applies to Adidas. Highly abnormal pricing, even with a âsummer saleâ underway. Doesnât bode particularly well.
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Every retailer has certainly been running those âpreseasonâ and âmidseasonâ sale ads throughout the spring. Still, in my opinion, prices are really high at every store; for example, theyâre asking anywhere between 20 and 40 euros for a Nike t-shirt. It probably doesnât just apply to XXL, but Iâve noticed that the quality of sportswear has dropped significantly. Itâs hard to justify high prices, at least from that standpoint.
Those brands arenât sold off at -40%. Even the biggest players donât have the pricing power for that. Today, the entire Haglöfs range is -50% for a week. Margins are suffering heavily. It could be an aggressive inventory clear-out for the coming autumn, or it could be propping up the cash flow.
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The manufacturer likely contributes to the costs of these discount campaigns with marketing support, but they will still take a big bite out of XXLâs margins as well.
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XXL has been in the headlines quite a bit in Finland, though not for the best of reasons. However, XXL Finlandâs CEO instills confidence that XXLâs inventory situation will be in better shape heading into H2 '23.
â During the first half of the year, XXL has balanced the mismatch between products in stock and weak consumer demand through strong campaigning, says XXL Finlandâs CEO Pasi LĂ€mpsĂ€.
â As we move into the second half of the year, XXLâs inventory values are at a relatively healthy level in relation to demand, he says.
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Sales and the cash shortage continue.
"(MT Newswires) â Nordic sports retailer XXL (XXL.OL) is looking to raise 500 million Norwegian kroner through a proposed underwritten rights issue, according to a Wednesday release.
The company plans to issue 1,250,001,065 new shares at 0.40 krone apiece, with the shareholders to receive 3.29403 subscription rights for each share held.
The planned rights issue is subject to the approval of shareholders at an extraordinary general meeting on Thursday.
XXL declined 2% on Wednesdayâs close."
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Iâve been keeping an eye on this and today was the Q3 review, mostly just pinging about that. Even the already low expectations were too much for XXL.
Revenue dropped by about 10% from last year and losses continued. Assets after the quarter were 782 (million NOK), net interest-bearing debt was 862 (million NOK) and the loss was 140 (million NOK).
According to the CEO, the inventory situation is finally within normal limits, which should improve margins going forward. Incidentally, the number of shares sadly nearly tripled in a year.
Q4 sounded like they expect more of the same. No rush to get in yet, but the development in 2024 needs to be watched. If thereâs no sign of a turnaround next year, they might have to print more shares in the future too (my own speculation).
Otherwise:
XXL saw a rapid rise of over +80% in mid-October. At that time, Frasers Group (a British retail, sports, and intellectual property owner) bought about 118 million more shares. After that, Frasers Group owned 9.75% of all XXL shares and 12.16% of the votes. This news raised expectations for the Q3 result.
However, that hype died down in a couple of weeks, as is typical in the current market, and now it turned out that at least in Q3, no turnaround had happened yet. And the CEO didnât promise a turnaround for Q4 either, mostly speaking about cost savings for next year.
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shopping-center-loses-big-tenant/âŠ`
* That would be a translation of the link, which Rule 3 explicitly forbids.
* What if I provide the headline *as* text? But the "content" is *only* the URL. If I add a headline, I am "adding content besides the translation" (Rule 8).
* Therefore, the only valid response following all rules is the URL itself.
* Wait, I just thought of something. If I return just the URL, does that count as
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Q1 results were released today.
XXL-ASA-Interim-report-Q1-2024.pdf (xxlasa.com)
EBITDA was actually positive, NOK 12 million (vs. NOK -45 million a year ago), but the result was still NOK 202 million in the red. Depreciations (depreciation, Iâm not sure if itâs the same since the language is different) accounted for 200 million of that.
Revenue decreased by approx. -22%. The market is challenging; this is the ninth consecutive quarter where revenue has declined.
They expect EBITDA to rise to NOK 500-750 million over the next 12-15 months.
The store previously closed in Finland was unprofitable and was closed for that reason.
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Below is a small piece of news related to XXL, about which @Arhi_Kivilahti has made a tweet.
https://x.com/ArhiKivilahti/status/1864942654733054355
Here is the link that was in Arhiâs tweet:
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