Gdansk (Reuters) – Poland’s biggest fashion retailer, LPP, said on Monday it would boost its presence in the European Union, changing direction after suspending operations in Ukraine and closing stores in Russia.
Losing the two eastern markets would cost 25% of revenue, he said.
In response, it will enter Italy, Greece and Cyprus next year and continue to expand its “Reserved” brand in Germany and Britain.
“After the difficult period of the pandemic, we faced new challenges related to the loss of an important part of the sales network,” said CFO Przemyslaw Lutkiewicz, referring to the suspension of Ukrainian operations and the the decision to leave Russia.
“Despite this, the company’s situation remains stable, and the expected revenues for the current financial year, more than 16 billion zlotys (3.76 billion dollars), allow us to think calmly about the future of LPP. “, added Lutkiewicz.
Since the company could not predict the future situation in Ukraine, it decided to focus on EU markets where it already had a presence, he said. “At the same time, we want to debut in new markets, especially in the southern region of Europe, where we see growth potential for our brands.”
The company will also focus this year on the development of its e-commerce activity which, in the fourth quarter of its financial year ended January 31, 2022, exceeded 30% of total sales.
In the current year, the estimated value of income from online sales can reach 5 billion zlotys. It would be 31% if the total income was 16 billion zlotys.
(Reporting by Adrianna Ebert; Editing by Kirsten Donovan and Bradley Perrett)
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