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General

Karstadt: first annual net profit in 12 years

  • 10 percent of sales online in the next financial year.
  • CEO Stephan Fanderl: “There will be several new store openings.”
  • For the 2016/2017 financial year, Karstadt generated an annual net profit for the first time in twelve years.

    “We have therefore fulfilled our promise for the third year in succession”, explained Karstadt CEO Dr Stephan Fanderl. “In the first year of restructuring, we generated a plus at the tills, in the second, a positive result from ordinary operations* and in the past financial year, an annual net profit.”

    The like-for-like store portfolio recorded a slight increase in sales in the financial year. Letting to attractive partners, such as dm, Aldi, Edeka or Apollo Optik also had a positive impact on shop floor performance.

    Partnerships are therefore also important to continue speedily and resolutely on Karstadt’s course in the direction of a connected marketplace. “A ‘digitalisation race’ is currently evident in the German retail sector,” says Stephan Fanderl. “Companies that act too slowly and irresolutely will not survive this race. However, we are determined to develop Karstadt into one of the strongest retailers connected across all sales channels in Germany. We shall increase the share of our online sales to around ten percent by 2019/20.”

    Fanderl continues: “As a department store and, having regained our economic health, we are ideally positioned for this with the variety of our products, partners and customers. While online retail including food rose by around ten percent during the Christmas sales, it increased by around 50 percent at Karstadt.”

    In recent months, Karstadt has taken a large number of measures to accelerate digitalisation significantly. These not only include the recruitment of recognised experts at all management levels but also, for instance, work on an “experience store” in Düsseldorf, in which the digitalisation of stores is being tested, same-day delivery with major partners in several cities, services such as Click&Collect or Click&Reserve in all stores or Amazon lockers in 15 Karstadt stores now.

    The competitive situation facing city centre department stores is and will remain extremely challenging. “With all measures, we focus on the speed with which they will pay off and how soon they can be rolled out,” says Fanderl. “For instance, we already have 30 stores from which we despatch merchandise. By the end of the year, it will be all 79 stores. This means that, unlike other retailers, we shall be able to despatch merchandise from all our Karstadt stores and not only from a central warehouse. This makes us far more rapid. And, we are right in the city centre.”

    This shows that we have growth potential online and, especially, cross-channel through our stores”, explained Fanderl. “We shall not be standing still when it comes to new store openings. We have a portfolio of attractive locations and it is not a question of whether but when and at which of them a new department store will be built.”

    *Ergebnis der gewöhnlichen Geschäftstätigkeit