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Stockmann on Wednesday said it has downgraded its profit guidance for the year due to the worse-than-expected performance of Lindex, a fashion chain it acquired ten years ago.
Stockmann on Wednesday said it has downgraded its profit guidance for the year due to the worse-than-expected performance of Lindex, a fashion chain it acquired ten years ago.

 

Stockmann has warned investors that its result for this year is likely to fall short of forecasts.

The department store operator downgraded its guidance for the year yesterday, shifting the blame to the continuing struggles of Lindex, a fashion chain it acquired for a reported 870 million euros in 2007. 

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Stockmann believes its operating profit will at most match, or even fall short of, the 33.8 million euros it reported in 2016.

Lindex kept the retailer afloat for a number of lean years but has failed to repeat its record-breaking performance in 2016: Its operating profits in the first half of the year fell well short of the profits posted one year earlier, forcing it to downgrade its profit guidance for the year in spite of its improved performance in September.

Stockmann was previously expecting its operating profit to improve from the previous year in 2017. It reported an annual operating profit of 33.8 million on a turnover of 388.4 million euros in 2016 but failed to meet the expectations of analysts in the second quarter of 2017, posting an operating profit of 14.6 million euros.

Aleksi Teivainen – HT
Photo: Heikki Saukkomaa – Lehtikuva

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