January 22, 2013 / 12:40 PM / 5 years ago

UPDATE 1-Germany's Douglas says Christmas sales fall short of hopes

* FY EBITDA down 31 pct at 201.2 mln eur, in line with fcast

* Co says Xmas sales ok but expected better

* Fiscal first quarter sales including Xmas up 1.6 pct

* Company being taken private by founding family

By Victoria Bryan and Matthias Inverardi

DUESSELDORF, Germany, Jan 22 (Reuters) - German retailer Douglas Holding AG said Christmas sales fell short of its expectations after consumers stayed away from stores until the last minute, checking out deals online instead.

The comments from the seller of perfumes to jewellery underscore the fiercely competitive nature of the holiday season in austerity-hit Europe, marked by retailers fighting over shoppers’ dwindling budgets with discounts and offers.

“It was ok, but we expected better,” Douglas Chief Executive Henning Kreke told journalists on Tuesday.

“There just weren’t as many people out and about in the run-up that we could draw into our shops,” he said, speaking of a trend for consumers to get information online before going shopping in the final week before Christmas.

The group, which had already reported sales up 1.7 percent to 3.44 billion euros ($4.6 billion) in the 12 months through September, said revenue in its fiscal first quarter, which includes Christmas, rose 1.6 percent.

Other retailers including Germany’s Metro and, in Britain, Dixons and Debenhams, have also spoken of a late pick-up in trading in the final days of the Christmas shopping period after a slow start.

The switch to online buying has been a particular problem for Douglas’s Thalia chain of bookstores, which was late to acknowledge the threat from the likes of Amazon.com.


“Many retailers did not recognise this trend fast enough, and I include Douglas in this. But we have taken action,” Kreke said, highlighting the launch of an e-book reader and the planned closure of 15 of its 296 stores.

The company, publishing its last set of annual results as a listed company following a takeover by its founding family backed by private equity, said full-year earnings before interest, tax, depreciation and amortisation fell 31 percent to 201.2 million euros, in line with its own forecast and hit by weakness in the Thalia books division.

At Thalia, the group booked restructuring costs and writedowns of 155 million euros for the fiscal year, dragging the group down to a net loss of 109.9 million.

It would not be paying a dividend for the year, it added.

Jewellery was a bright spot, Douglas said, with yearly sales at its Christ chain of stores up 9.6 percent.

Demand for diamond rings and gold watches is being fuelled by an uncertain economic outlook, which is making shoppers in Europe’s largest economy seek out gifts more likely to retain - and possibly increase - their value, some experts have said.

Kreke said Douglas would disappear from the stock exchange having spent almost 50 years as a listed company. With private equity partner Advent International, it plans to expand internationally with both the Christ chain and its namesake Douglas make-up and perfume stores.

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