Refocus at Vögele

Poor results mean things will be changing at Vögele Keystone Archive

Charles Vögele, Switzerland's biggest fashion retailer, plans to refocus its operations over the next nine months following a set of poor results.

Recently appointed chief executive Daniel Reinhard told a press conference in Zurich that Vögele needed to have a clearer focus on its target customers and collection.

He said some 25 people at the head office would work the project and it would take nine months to do.

The company reported earlier on Tuesday that its sales growth slowed in 2001 and it expects its income to suffer as a result.

The group, founded in 1955 as a motorcycle accessories shop, said on Tuesday that its 2001 net sales rose 15.3 per cent to SFr1.63 billion ($981.9 million).

Weather affected sales

The sales rise was in line with its revised outlook and with analysts’ expectations after the group made a profit warning in October, when unseasonably mild weather depressed sales of the winter collection and created surplus stocks.

Vögele reiterated it expected net income from operating activities to be clearly below that of 2000 and added it was considering write-downs on its balance sheet.

In 2000 it had a net profit of SFr81.2 million and an operating profit of SFr152.3 million.

Vögele, also active in Germany, Austria, Belgium and the Netherlands, warned in October that full-year sales would be up some 16 to 18 per cent and not by a targeted 20 per cent after a slowdown in the third quarter due to mild weather in October.

Sceptical investors

Vögele, listed on the Swiss Exchange since June 1999, saw its shares drop 73 per cent in 2001. So far this year they gained five per cent.

Investors have been sceptical about the weather issue and noted that some top management changes have been stepped up as Vögele was absorbing a rapid foreign acquisition drive.

Daniel Reinhard, former chief executive at German shoe retailer Salamander, had been appointed to take the helm at Vögele from Peter Graf in April. But in October his appointment was brought forward to January 1.

Expansion masks sales decline

When the sales figures are adjusted to strip out the effects of floor space growth, even they show declines. Sales per square metre dropped 12.6 per cent to SFr3,115 and sales per staff member were down 5.1 per cent at SFr298,0000.

In Switzerland, net sales rose a nominal one per cent to SFr606.3 million, and in Germany the turnover was up nine per cent at SFr578.8 million.

In Austria sales rose nine per cent to SFr247.1 million while in Belgium and the Netherlands the figure surged to SFr198.4 million from SFr56.3 million.

The last increase was due to the integration of the 106 Klen stores its agreed to acquire from Dutch retailer Koninklijke Vendex in November 2000.

Vögele said in a statement that the overall slowdown in the sales rise was due mainly to developments in Switzerland and Germany.

swissinfo with agencies