Otto Group returns to profit

The Otto Group has found its way back to profitability. The company refers to the past financial year, which ended in February, as an “extremely convincing financial year”. The retail and services group generated a net profit of 165 million euros. Otto is optimistic about the future and expects further growth, particularly from its successful marketplace.

Last year, the Otto Group incurred a loss of 426 million euros. The improvement in profitability is partly due to a reorganization within the company, which resulted in the elimination of nearly 6 percent of jobs, including hundreds of customer service positions.

Progress

After two years of revenue loss, Otto Group’s consolidated revenue remained stable at just under 15 billion euros last year. It slightly improved on a comparable basis. However, the most progress was made on the profit side. The group states that by focusing on profitability and liquidity, it has created the foundation for a return to strong growth.

New CEO Petra Scharner-Wolff (pictured above) stated: “Our clear focus has enabled us to succeed not only in keeping revenues stable, but also in bringing the Otto Group clearly into the black at all earnings levels.”

‘We have faced up to the challenges of the market and coped with them very well.’

Scharner-Wolff says the board is satisfied with the achievements over the past financial year. “This has further increased our financial stability and now allows us to look forward with a degree of optimism.”

Otto’s GMV

The group owes much of its growth to the positive development of Otto’s marketplace. The trading volume on Otto.de and the associated app grew by 9 percent in the past financial year, reaching over 7 billion euros, outperforming the competition in German ecommerce. The number of active Otto customers climbed by 4 percent to 12.2 million. By 2030, Otto’s GMV is expected to reach 10 billion euros, according to CFO Katy Roewer during a press conference on the figures.

Despite the extremely challenging market environment, Otto Group believes it will be able to keep sales revenue stable on a comparable basis this year and once again significantly improve its profitability. The company, which is preparing to part ways with About You, will continue to seek margin improvements afterward, according to Scharner-Wolff. To achieve this, Otto will place greater emphasis on the group’s technological competitiveness.