Zalando makes first ever annual profit

Zalando had been operating in the red for six straight years, but it achieved its first ever annual group profit in 2014, with an adjusted earnings before interest and tax of 82 million euros. Meanwhile, its revenues grew by 26 percent to 2.2 billion euros.

These are the main numbers Zalando had to share today, as it published its preliminary results. It also shows that Zalando’s revenues grew by about 21 percent to 666 million euros in the fourth quarter of 2014. In the same period, it achieved an adjusted EBIT of 66 million euros, marking a new all-time high quarterly profit.

According to the immensely popular online fashion platform this development was driven by improvements along several costs lines, such as cost of sales and marketing. “Our 2014 performance proves that Zalando’s business model is sustainable and can achieve significant margins”, said Rubin Ritter, member of the management board. “Our focus in the coming years will be to make the right investments for continued long-term growth and value creation, and not to maximize our short-term margin.”

In terms of revenue, the German company wants to achieve a growth rate of 20 to 25% in 2015, while the focus continues to be on delivering profitable growth. “Driven by investments in long-term growth, Zalando expects 2015 margins not to exceed the strong level achieved in 2014”, the company tempers the elation. All figures are preliminary and unaudited, but full financial figures and more information will be published on March 5, 2015.

Zalando began selling shoes in 2008 and now ships 1,500 brands of shoes, clothing, accessories and more to customers in 15 countries.