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Etam ahead in Q1 as China turnaround takes hold

France-based international womenswear and lingerie retailer Etam Group is enjoying sales success in both Europe and China as the latter’s strategic turnaround plan took hold. It noted sales in France also outperformed the market in Q1.

The retailer’s total Q1 net sales rose 5.9% to €346m, including a positive currency impact of €21.1m relating mainly to the strong appreciation of the yuan against the euro. In the quarter to March 31, same-store sales rose 0.9%.

European sales rose 2.7% to €214.9, with comps up 1.7% at constant exchange rates.

In China, sales rose 11.7% to €131.2m, mainly thanks to a positive currency impact of €20.9m, although comps slipped 0.8% at constant exchange rates.

For fiscal 2014, Etam Group net sales rose 0.4% to €1.22bn as same-store sales at constant exchange rates increased 0.7%.

In Europe, sales increased 4.3%, or 2.5% on a comparable basis and at constant exchange rates.

In China, comps and at constant exchange rates stabilised in the last nine months after a sharp decline in Q1, it said.

Gross margin Gross margin increased by 1.1 percentage point year-on-year to 59.0%, mainly due to the favourable net impact of the sales of residual stocks in China and to improving sales margins in the ready-to-wear activities in Europe.

Net income for the year rose to €23m from €19.6m in 2013 while operating income for the year rose 5.4% year-on-year to €51.7m.

At end-March the group had 4,084 sales points including 939 in Europe, 259 international franchises and 2,886 in China.

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