Global Fashion Group S.A. Shows Promising Improvement Despite Declines

Global Fashion Group S.A. (GFG) anticipates releasing its Q3 figures on November 7. NuWays AG, in its recent research update, maintains a 'BUY' recommendation, highlighted by a target price of €0.80. While GFG expects a minor drop in net merchandise value (NMV) and sales, noticeable gross margin improvements are expected.

LATAM and ANZ regions are positioned as substantial growth drivers. LATAM NMV is projected to grow 1% year-on-year, despite FX challenges, reaching €71 million. ANZ should experience a 2.1% increase, attaining €127 million. Conversely, the SEA region faces a 12.1% decline due to reduced customer base and order value.

GFG's strategic shift towards increasing Marketplace share is evident, with it climbing to 39%, though this might cause a reduced sales-to-NMV ratio. Overall sales are predicted to fall 5.7% year-on-year to €164 million. Crucially, gross margin improvements appear sustainable owing to strategic retail and marketplace adjustments.