SIGNA Sports United (SSU), a specialist sports e-commerce company listed on the NYSE, released its Q2 2023 financial results, which were disappointing. YoY, sales declined by over 23% and gross profit by over 52%. The company experienced a 2% decrease in revenue for H1 2023, attributing it to subdued demand and market overstock. SSU is a part of the Signa Group, led by Austrian real estate investor Rene Benko.
The operational and financial situation of SSU appears challenging. The company anticipates a significant negative cash flow of up to €270 million in 2023. Without financial support from the owners, the company could potentially face bankruptcy.
The company secured a €130 million financing commitment to address the liquidity issues from SIGNA Holding. Furthermore, an additional equity commitment letter was signed on June 26, 2023, with commitments from SIGNA Holding to provide the company with an extra €150 million in liquidity until September 30, 2025. SSU is confident that these liquidity commitments amounting to €150 million will adequately cover its operational and investment-related funding requirements until fiscal year 2025.
The number of active customers on SSU‘s e-commerce sites decreased by 15% year-over-year, reaching 6.1 million.
Stephan Zoll, CEO of SSU, acknowledged the challenging conditions faced by the sports retail industry in the first half of the fiscal year. Despite the macroeconomic headwinds and market oversupply impacting its financial results, the company remains focused on positioning itself for success as operating conditions normalize. SSU conducted a comprehensive strategic repositioning of the business to facilitate a return to profitable growth and positive cash flow, considering the near-term demand outlook.
Things are not going too well for Benko and his Signa Group in the real estate sector. Rising interest rates, more restrictive lending, and falling prices are eating away at the group’s substance. The media have recently been increasingly reporting worrying facts in Germany and Austria.
