LPP summarises the results after three quarters of this year. – sales growth by 72% and over PLN one billion of net profit.

• In the third quarter of the 2021/22 financial year the revenues of the Polish clothing manufacturer increased by 60% YoY and amounted to nearly PLN 4 billion.

• The past quarter saw LPP double its e-commerce turnover and return to triple-digit growth. Therefore, the company recorded online sales increase by 85% between February and October, compared to a year ago.

• The company once again achieved higher revenues from abroad, which in Q3 2021/22 already accounted for 57% of the Group’s revenue.

• After 9 months, LPP’s omnichannel revenues growth was 72% compared to the same period last year, providing the company with over PLN 1 billion in net profit.

The next quarter of the current financial year was marked by intensive development of LPP in the omnichannel model. In accordance with the adopted strategy, the Polish clothing manufacturer has been strengthening e-commerce sales while implementing plans to increase retail space in the traditional channel. As at the end of October this year, the company already had more than 2,100 stationary stores in 26 markets, and the online offer was available in 31 countries. As a result, in the third quarter of 2021/22 the company increased its revenues by 60%, which amounted to almost PLN 4 billion. At the same time, it generated a net profit of over PLN 1 billion since the beginning of this financial year, with revenue growth of more than 72% in the period.

– Thanks to well-thought-out collections and the implementation of the omnichannel strategy, in the third quarter our company was still able to benefit from the persistent effect of deferred demand. The gradual increase in the availability of our brands’ offer, supported by the facilities our customers can enjoy thanks to the omnichannel sales model, resulted in an increase in the company’s sales by over 72% YoY in the nine-month period of this year. Good results are also due to a favourable gross margin, which at the end of the third quarter amounted to over 58%. This significantly higher level compared to last year is on the one hand the effect of more favourable purchase prices of the autumn/winter collection and, on the other hand, lower discounts in the sell-offs compared to last year due to lower availability of goods resulting from disturbances in the supply chains – comments Przemysław Lutkiewicz, Vice-President of LPP.

For the Polish clothing company, the last quarter was also a time of doubling its turnover from online sales. The triple-digit dynamics in this channel in the period from August to October contributed to an increase in sales from the beginning of the year by 85%. Despite the gradual return of customers to traditional shopping, the share of online sales in the Group’s revenues continues to grow successively. In the third quarter of this year, it already accounted for over 23% of sales in all countries.

– The 147% YoY increase in online sales in Europe in the third quarter of this year clearly indicates the growing interest in our brands in this region. We are also pleased with the 120% increase in online sales in Eastern markets. Such good results confirm the correctness of our decisions to invest in logistics and technological facilities that support the process of e-commerce development and omnichannel transition of the company. With the expansion of the logistics network of Fulfillment Centers in Central and Eastern Europe and the entry into a new, 31st online market in Bulgaria, we have taken another step to increase competitiveness in our key markets – adds Przemysław Lutkiewicz.

A 30% YoY increase in the floorspace of the stationary sales network and sustained dynamics of e-commerce gave rise to LPP sales growth in all European countries by 74% YoY. As confirmed by the company’s management board, decisions made in advance as to ordering goods and preparing for the rebound in demand make it possible to respond to customer expectations in all markets. Thus, thanks to the doubling of results in the Czech Republic, Bulgaria, Croatia and Slovenia, as well as in the CIS region, the company ended the third quarter of this year with the share of foreign sales at nearly 57% of Group revenues.

Despite the continuing sense of uncertainty resulting from the aggravation of the pandemic and the turmoil in the supply chains, LPP’s strengthening of its position in key markets and the company’s good financial standing allowed it to introduce mass pay rises for employees. – As a Polish family company we are aware that we could not have achieved such good results without the enormous support of those who create LPP with us – our employees. Given the unquestionable contribution and commitment of all the teams who have supported us in the fight for the company’s survival, today we are able to continue operating and develop further – comments Przemysław Lutkiewicz.

In gratitude for the commitment of the LPP employees, the management board has decided to increase the salaries of all teams. Moreover, a decision was made to introduce changes in the remuneration policy for sales network employees starting the beginning of next year, including a new bonus system. – We hope that the sense of security and new, better employment conditions will allow us and our employees to continue building an efficient and prosperous organisation – concludes the Vice-President of LPP.

Not only do the good financial results of the Polish clothing company allow it to introduce changes in the remuneration policy for all employees working for LPP. It is also an opportunity to fulfil the obligations resulting from the sustainable development strategy and to take actions aimed at limiting the company’s impact on the environment. The company’s consistent actions in this area have real and measurable effects, which was confirmed by the high rating in the “Climate Strategy Benchmark” study, conducted by ESG experts and practitioners from the UNEP/GRID-Warszawa Centre and Go Responsible Poland. Thus, the Gdańsk-based company secured a place as one of the leaders in reporting on climate issues, among the companies of WIG20 and mWiG40 group. LPP’s second place, following the survey of Climate Conscious Companies, is yet another high rating of the company’s environmental impact reporting.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.7 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs 27 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP increases salaries and announces recruitment actions

By the decision of the LPP Management Board, as of January 2022 all people employed in the company’s headquarters will receive a 10% pay rise. The Polish clothing manufacturer has also announced a new remuneration policy for the sales network and the semi-annual bonuses payout before the end of this year. The company’s management board has also decided that those who will be negatively affected by the tax changes announced at the beginning of the year can count on compensation. The current financial standing of the company is, according to the board, the result of a joint effort of all teams, and the decision on the mass pay rises is a token of appreciation for the work and contribution of each employee in maintaining the stable situation of the company.

The financial results recorded in the first quarters of this year and the growing potential of the omnichannel sales model are a signal to the management board of LPP that the company’s situation is stabilising after nearly two years since the outbreak of the pandemic. Customers are gradually returning to shopping in traditional stores, making well-thought-out purchases, and the collections of all the brands have matched their current expectations. On the other hand, the Polish clothing manufacturer has been recording steady growth in the e-commerce channel for many months and is strengthening its position on foreign markets. As the LPP management board emphasizes, what had the greatest influence on the current good standing of the company was the flexibility in action, but above all, the determination and commitment of all employees.

– When making the decision about the mass pay rises, as the management board of a Polish family company, we wanted above all to appreciate the determination and commitment of each employee of our headquarters and sales network who, together with us, took up the challenges posed by the pandemic. We are aware that it is thanks to the people who work and create LPP with us that today we can look into the future with optimism and take further decisions concerning our development. Appreciating the fact that they were with us in difficult moments for the company, today – as a company taking responsibility for its employees – we want to give them a sense of security, regardless of what is happening outside our organisation – says Marek Piechocki, CEO of LPP.

The 10% pay rises will apply to all employees at LPP headquarters, regardless of their positions. The management board of the Gdańsk-based company has also decided to grant a full, half-yearly base bonus still this year, regardless of the results achieved, as well as to introduce changes in gross salaries for all those who will lose out on the new tax changes applicable from January 2022. The company is also working on a new remuneration policy for the sales network. The changes including, among other things, rate increases and a new bonus system will be effective from the first quarter of next year.

– As a responsible employer we cannot stand still, forgetting that the world around us is changing. We have emerged from the pandemic crisis stronger than ever. However, we are aware that without trusted employees, ready to take on new challenges along with us, we will not be able to grow. And our plans for the coming year at LPP are ambitious ones, indeed. Further development of logistics and strengthening the potential of the sales network will require good employees. I hope that the conditions we offer them today will encourage them to continue their creative work and build a strong LPP with us – adds Marek Piechocki.

LPP Group currently employs 27 thousand people, including almost three thousand at the company headquarters. Taking into account the plans for development and strengthening the omnichannel sales in those markets where the offer of LPP brands is available, next year an increase by even 750 people as regards the employment at the headquarters is expected, especially in such areas as logistics or in teams responsible for implementing IT solutions.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.7 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs 27 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP introduces an automatic sorting system at the Slovak Fulfillment Center

The Polish clothing company LPP is investing in technologies aimed at streamlining logistics processes at its Fulfillment Center in Slovakia. The state-of-the-art pocket sorter installed in the warehouse along with the conveyor system and posisorter support the order picking process and optimise the use of space of the facility. Warehouse automation also significantly speeds up the handling of e-commerce shipments and supports “next business day” deliveries.

The implementation by LPP of further solutions aimed at increasing the efficiency of logistics processes, this time at the warehouse in Slovakia, was dictated by the dynamic increase in the volume of online orders in the Central European region. The facility plays a key role in the distribution network of the Polish company, providing services to online shoppers not only in Slovakia, but also in Germany, the Czech Republic, Croatia, Hungary, and Slovenia.

– Taking into account our scale of operations and the growth prospects of LPP on foreign markets, the implementation of advanced warehouse automation was a necessity. It allows us to increase the efficiency of the facility and optimize the process of delivering ordered goods to our customers, which in the face of the ever increasing pressure to shorten the wait time for shipments, significantly increases the competitiveness of our offer on Central European markets – comments Sebastian Sołtys, Logistics Director, LPP.

In order to improve the work of the Slovak Fulfillment Center, a multi-level pocket sorter and conveyor system was installed at the facility, which, combined, support the process of picking online orders. The whole is complemented by the so-called posisorter, i.e. a shipping sorter which automatically assigns completed packages to the appropriate exit ramp according to their characteristics, country of destination and the courier company that is to receive them. The new system significantly speeds up the handling of e-commerce shipments. It also supports next business day deliveries which the company offers to its customers in the Central European region.

– The warehouse, operating in a two shifts mode, 7 days a week, will significantly increase its productivity, which is necessary in view of such a dynamic sales growth in this area. The introduction of an automatic sorting system, with an hourly capacity of up to 8000 pieces of clothing, greatly facilitates our work. Not only does it increase the efficiency of the Fulfillment Center, but it also supports decision-making processes and eliminates errors resulting from manual sorting of goods. What is equally important – the installed equipment is easy to service and maintain – explains Michał Moteka, Business Process Optimisation Manager, LPP.

The entire multi-level installation is as much as 3 kilometres long. It consists of, among others, workstations where warehouse employees place products in the pocket sorter partitions. The machine separates the assortment according to individual orders and the sorted goods are directed via a system of conveyors to the packing tables. Then, properly secured for dispatch, the finished packages are delivered to the dispatch sorter, which, using the Warehouse Management System (WMS), automatically allocates them to dedicated points for collection by shipping companies. Thanks to the automation used, the Slovak Fulfillment Center is able to prepare over 4000 parcels per hour for customers.

The pocket sorter also offers significant benefits when handling returned goods, which can be automatically and quickly transferred to re-dispatch or storage. Up to 25,000 items of clothing can be stored in this way, further optimising the use of storage space at the facility.

The LPP Fulfillment Center in Slovakia, which has been operating since July last year, covers an area of 32,000 m2. The warehouse also operates in the cross-docking model, which combines operations typical of online sales with the supply of the chain of stationary stores in Central Europe.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP has completed the construction works on site of the Distribution Centre in Brześć Kujawski.

After 10 months of construction works, LPP is preparing to launch its Distribution Centre, located in the municipality of Brześć Kujawski. The facility of 75,000 m2 is currently being fitted with equipment in the main hall and finishing works are underway. The beginning of next year will mark the gradual start-up of the warehouse, which will eventually lead to the full functionality of the Centre. According to the schedule, the new LPP facility will be operational in the first quarter of 2022.

– The Distribution Centre in Brześć Kujawski is a strategic investment that will provide us with global connectivity to our stationary stores located on three continents. Given the current market trends, efficient logistics determines the competitive advantage of commercial companies. By increasing the capacity of the supply network, we influence the availability of goods to customers in all 26 markets where our stores operate. We are all the more pleased that thanks to the effective cooperation with local authorities and our partners we are in the final stage of one of the most important logistic undertakings in the history of LPP, and that soon we will be able to tap into this location – comments Jacek Kujawa, Vice-President of LPP. The Distribution Centre in Brześć Kujawski will be LPP’s second largest own logistics facility, significantly relieving the central warehouse in Pruszcz Gdański in terms of international sales network services.

Works on the LPP investment in Brześć Kujawski commenced in January this year. A total of 20 companies were responsible for the various stages of the project, which was carried out by over 1,000 people. Over 40 thousand tons of concrete, 1200 tons of steel and 700 tons of roofing sheets were used to build the facility. The main hall has already been fitted with high storage racks with 80,000 pallet spaces. Finishing works are currently underway, including the assembly of furniture and automatic sorters.

At the same time, works also include the over 10-hectare plot surrounding the Centre. Nearly 40% of the space around the building is covered by green areas where biodiversity has been taken care of by planting various species of trees, bushes and grasses. What distinguishes the LPP Centre from the perspective of amenities for future employees is also the extensive internal transport and road infrastructure. Bicycle lanes, access roads and maneuvering areas have been developed on over 68,000 m2 of land. The employees will also have over 600 parking spaces and 100 roofed bicycle parking spaces at their disposal.

Unique from the perspective of this type of investment is also the separation of the own bus depot, within which 5 platforms and 17 parking spaces are planned, thanks to which the buses will not obstruct the traffic. Separate traffic lanes and 71 parking spaces have also been planned for delivery vans only, which will minimise the hindrance related to the passage of lorries – both on the site and in its immediate vicinity.

– All investments and business plans, also in the key area of logistics, strictly adhere to the strategy of sustainable development. In the case of the new Distribution Centre, it was very important for us to meet certain standards. The main assumption was to create a modern workplace, including proven solutions in the field of warehouse automation and well thought-out use of space. It was also particularly important to minimise the environmental impact of this investment. We are glad that we could cooperate with trusted partners, who were able to meet these expectations and deliver according to the agreed schedule – comments Sebastian Sołtys, Logistics Director at LPP.

The facility is in the process of BREEAM certification – verifying its compliance with sustainable construction standards. The warehouse provides a number of facilities for employees and green solutions, e.g. 4000 photovoltaic panels on the roof of the building. Grey water recovery is also planned for sanitation and cleaning. A recuperation system has been planned for the office premises, enabling up to 95% of heat to be recovered, and a BMS (Building Management System), which will allow for the integration of automation, elements for monitoring equipment operation and energy consumption, as well as the technical installations of the facility. Skylights on the roof and a progressive LED lighting system adjusting its intensity to weather conditions and time of day have been applied. All these solutions will contribute to greater comfort of work and bring savings in the use of natural resources.

The Gdańsk company has already commenced the initial stage of recruitment for functional positions in Brześć Kujawski, including section managers, foremen and fork-lift truck operators. Towards the end of the year, the main recruitment phase will be launched, which will cover the remaining jobs necessary for the operation of the Centre, including primarily warehouse workers and people responsible for packing goods. By the end of the first quarter of 2022, LPP plans to create 500 jobs. Information about the current recruitment process and a contact form for interested candidates are available at: www.lppsa.com/kariera/praca-w-brzesciu-kujawskim.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

SAVE THE DATE: LPP’s 3Q21/22 videoconference, 9th December, 12.00 pm CET

Dear Sir or Madame,

LPP, the leading CEE fashion company, has the pleasure to invite you to participate in its videoconference, on Thursday, 9th December, 12.00 pm CET.

The CFO, Mr Przemysław Lutkiewicz, will comment on the company’s 3Q21/22 numbers and developments.

Videoconference in English will be available under the following link:

https://platforma.livingmedia.pl/lpp/210422003/

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP’s Gdańsk headquarters with “The best office in Tri-city” title – awarded by the jury of the Office Superstar 2021 competition

Fashion Lab 2 – the Gdańsk office building of LPP – received the main prize in the Office Superstar competition, winning as the “Best Office in Tri-city”. The jury also appreciated the modern solutions applied in the facility, awarding Fashion Lab 2 with a distinction in the “Innovation and Technology” category. The building, designed as part of the LPP office complex located at Łąkowa Street in Gdańsk, was commissioned and opened to employees at the beginning of this year.

Office Superstar is a competition organised by CBRE, a company specialising in consultancy and investments in the commercial real estate sector. It seeks to promote innovative solutions in the field of office space arrangement, presenting current trends in various sectors and honouring pioneering concepts which work well in practice. It is addressed to organizations which perceive their offices not only as places to work, but also as spaces boosting motivation or stimulating creativity.

– Through the LPP Fashion Lab 2 project in Gdańsk we wanted to create not only a functional, but above all, friendly and comfortable space for our teams. As a company operating in the fashion industry, we do realise how important it is to inspire and boost creativity, also through the office environment in which we work every day. Therefore, we wanted the new building of the Fashion Lab complex to be more than just a place to spend the eight-our work time every day – we wanted it to become a hub of creativity for our employees where new ideas emerge. We are very pleased to have been awarded the Office Superstar title for the best office in Tri-city and we believe that the facility we created does indeed meet this objective – says Łukasz Piwoński, LPP’s Administrative and Technical Director.

The awarded building was designed in an industrial style, with the use of natural materials – wood, concrete and steel – and with numerous green areas integrated into the office space. Caring for the comfort of employees, a mini-park and a green square surrounded by hills, on which terraces with a work and relaxation zone were formed, were created in the area surrounding the building.

The jury of the fourth edition of the competition – consisting of experts in the field of real estate, architecture, work environment or change management and design – evaluated the entries in terms of, among others, aesthetics, elements supporting the well-being of employees and user experience, as well as spatial solutions, materials, as well as ecological and technological solutions. Apart from the main category – “The best office” – broken down by the biggest cities in Poland, prizes were awarded in two more categories: “Space for cooperation” and “Innovation and Technology”. In the latter, the experts appreciated the modern solutions used in Fashion Lab 2, which integrate advanced technologies and the company’s sustainable approach to modern construction.

– The fact that the jury appreciated the pro-environmental solutions applied in the new LPP office is all the more important to us as we have been trying to minimize the impact of our activity on the natural environment. In the process of designing the building, we strongly focused on using modern, green solutions, including among others the greywater system, which uses rainwater to flush the toilets, or the cooling ceiling technology, which is an alternative to standard air conditioning, using water instead of Freon. Green technologies present throughout the building also include energy-efficient lighting and an automatic system for energy, heating, ventilation and air conditioning control to reduce the building’s energy consumption. We are pleased that these actions are being recognised, which motivates us even more to develop in the spirit of sustainability. For us, the award also confirms that the implementation of environmentally friendly solutions is a good direction – adds Łukasz Piwoński.

The BREEAM-certified facility was handed over to employees at the end of January this year. Hence, that date marks the completion of the first stage of the Fashion Lab complex extension, with the building planned to ultimately consist of four office buildings and allow for gathering most of the Gdańsk-based teams in the same location in the Dolne Miasto district of Gdańsk. The completion of the entire investment project is scheduled for 2027. Jems Architekci sp. z o.o. team was responsible for the architectural works on the prize-winning building, while Studio 1:1 was responsible for the interior design.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP prepares to launch a new e-commerce warehouse in Pruszcz Gdański

The expansion of the warehouse network dedicated to e-commerce services is the Polish clothing manufacturer’s response to double-digit growth in online sales and the growing reach of e-stores. The new Fulfillment Center in Pruszcz Gdański, with a total area of 64,000 m2, will increase the efficiency of LPP’s logistics in Poland, the Baltic states and Ukraine, among others. The agreement covers the lease of two connected warehouse halls. The first one, occupying 12,000 m2, has already been operating since July this year and is intended for handling returns. The launch of the second hall, in turn, dedicated to shipping online orders on an area of 49,000 m2 and over 2,000 m2 of office space, is planned for April 2022. By that date, the warehouse is expected to reach full functionality and start picking shipments. The lease of the facility from Panattoni is the largest warehouse contract for e-commerce in the history of the Gdańsk-based company, as a result of which the area dedicated to servicing LPP’s online stores will increase by over 30%.

The design of the new LPP Fulfillment Center located at Panattoni Park Tricity South II provides for a separation of a 49,000 m2 shipping hall, along with 2,000 m2 of office space and a 12,000 m2 section dedicated to e-commerce returns handling. The halls will be joined by a connector, thanks to which communication routes will be maintained, while the functionality of both buildings will remain divided. The lease of another Fulfillment Center warehouse is the Polish manufacturer’s response to growing customer interest in online shopping and the resulting demand for additional operational space. In the second quarter of the 2021/22 financial year, LPP’s online sales increased by nearly 28% YoY and already account for 22% of the company’s revenue.

– As expected, the online sales results of our brands are peaking at double-digit rates and there is no indication that this trend will change significantly. Operating on over 30 online markets, we also see that logistics efficiency is becoming a key element in building sales advantage. Taking into account the recent years, but also the forecasts for e-commerce, expanding the network of Fulfillment Centres, located as close to the customer as possible, will determine the sales results, but also affect the optimisation of logistics costs – comments Sebastian Sołtys, Logistics Director, LPP.

From April 2022, the part dedicated to e-commerce shipments will be picking orders for the Polish, Lithuanian, Latvian, Estonian and Ukrainian markets. The warehouse will accommodate a maximum of over 6 million pieces of product and will be able to process up to 100,000 orders daily. The returns hall, in turn, launched in July this year, is adapted to handle up to 80 thousand parcels a day, which, thanks to the proximity of the shipping part of the warehouse, will allow for quick replenishment of the online stores offer.

The favourable location will allow for a smooth processing of orders from foreign e-stores of the company. The new warehouse in Pruszcz Gdański is located near the A1 motorway and the key national roads (S6 and S7).

– The proximity of the key transport routes is an indisputable advantage of this location, thanks to which we will be able to improve and speed up the handling process of online orders for Central and Eastern Europe markets. Pruszcz Gdański is also the place where we established our Distribution Centre, which is the heart of LPP’s global supply and distribution network and ensures regularity of supply of the goods to our network of Fulfillment Centers. Both of these factors also contribute to reducing our carbon footprint. Thanks to the proximity of the source of supply and a shorter route to the end-customer, we reduce the resultant CO2 emissions and other pollutants – concludes Sebastian Sołtys.

Panattoni Park Tricity South II complex, where the LPP warehouse will be located, has been equipped, among others, with an advanced BMS system managing the facility’s automated control systems for electricity, lighting, ventilation, heating, as well as a system limiting water consumption.

The facility leased by LPP will meet the requirements of BREEAM certification, taking into account high environmental standards and solutions that improve comfort of work. In the already operating returns handling hall, among others, intelligent energy management systems, electric car charging stations were used, along with spacious windows in offices which increase access to daylight. A design analysis of the building was also carried out with regard to the use of natural light and acoustics of office spaces in accordance with BREEAM guidelines. Green areas and their biodiversity as well as enrichment of the ecosystem surrounding the investment were also taken care of. In accordance with the 2020-2025 Sustainable Development Strategy, announced two years ago, LPP wants all new construction facilities of the company to hold BREEAM or LEED certification by 2023.


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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP sums up the second quarter of this year and prepares for a difficult year-end

• In the second quarter of the2021/2022 financial year the revenues of the Polish clothing manufacturer increased by 71% compared to last year and exceeded PLN 3.6 billion. This is a result of, among others, the reopening of stationary shops and the phenomenon of deferred demand.

• The results generated made it possible to end the first half of this year with nearly PLN 6 billion in revenue and PLN 480 million in net profit.

• LPP’s online sales in the analysed quarter amounted to almost PLN 800 million. The growth dynamics of e-commerce is slower than last year, but remains at a double-digit level.

• A recipe for uncertain times and challenges in the upcoming six months is strengthening the multichannel sales model – LPP is expanding its stationary network, which at the end of the second quarter exceeded 2,000 stores and since September has included the 26th market – North Macedonia. In parallel, the company is expanding its e-commerce reach to its 31st online market – Bulgaria.

• LPP is integrating its business plans with its sustainability strategy, which was recognised in the corporate Climate Crisis Awareness study. The company has also signed a letter of intent with an energy supplier and will power its buildings using RES from 2023.

The period from May to the end of July this year brought the lifting of pandemic restrictions and the prospect of a slow stabilisation of the retail sector in Poland. The reopening of stationary stores allowed for a rebound in sales and generating long awaited growth. In the second quarter of the 2021/2022 financial year, revenues of LPP brands in the multichannel model amounted to PLN 3.6 billion with a gross margin of 55.4%. In the analysed period, the company generated nearly PLN 800 million in e-commerce, which accounts for 21.8% of the Group’s revenue. Compared to last year, online sales increased by nearly 28%. In omnichannel terms, the Polish clothing manufacturer ended the first half of this year with PLN 6 billion in revenue, thus improving last year’s result by 81%.

– In recent months, we have benefited from the effects of deferred demand. Customers missed shopping in stationary stores and our collections proved well-aligned with their expectations. We also continued to record growth in e-commerce, which is now lower – double digit – but given the last year’s soars in sales recorded in this channel, the trend is still high. Sales were also positively influenced by market circumstances and the associated relatively low cost of purchasing goods, as we placed orders for the Spring/Summer 21 collection back in 2020, during the peak of the crisis. This enabled us to end the first half of the year with a very good result. However, our enthusiasm is waning somewhat in the perspective of the next quarters. There are many challenges ahead of us, including delays in the delivery of containers with goods and a large increase in transport costs, significantly higher production prices resulting from rising prices of cotton and raw materials, lack of availability of RFID chips, computers and construction materials to build the stores. The inflation picking up is not helping either. I am also worried about reported stoppages in Chinese factories due to power cuts. As a well-developed omnichannel organisation, with efficient logistics, we are able to mitigate many of the effects of these risks. However, we see black clouds amassing over our company again. A year ago, the factories and logistics were operational, but the customer could not make purchases because of lockdowns. Today, we are experiencing disrupted supply chains, resulting in shortages and delays – comments Przemysław Lutkiewicz, Vice-President of LPP.

From the perspective of the last few years, the development of the omnichannel model in LPP proved to be a favourable factor in the face of the unfavourable market situation and changes caused by the pandemic. In line with the adopted strategy, the Polish clothing manufacturer develops e-commerce, while at the same time strengthening traditional sales. At the end of Q2 the offer of LPP brands was available in 2000 stores, and the area of the chain increased by 24% y/y. In September, North Macedonia joined the stationary markets, while the online offer of all LPP brands was introduced in Bulgaria. In the second quarter of this year, most European markets brought the company favourable revenue levels, but the highest growths were recorded in the CIS region. The development of sales potential is followed by investments in logistics – in July, the company launched a new warehouse in Russia, twice as big in size, which will triple the efficiency of e-commerce services in this country.

– We are strengthening our position on the markets with the highest sales potential. We can see that this strategy is viable judging by our sales results – our position on foreign markets is getting stronger, which is reflected in the nearly 60% share of exports in the Group’s revenues. Parallel to the dynamic growth abroad, we are still satisfied with the results in Poland where we record double-digit increases in sales. Here, in turn, we see potential for development in retail parks located in smaller towns. What worries us, however, is the increasing number of COVID-19 infections worldwide, which in many countries may soon mean the reinstatement of the lockdown on stationary sales – adds Przemyslaw Lutkiewicz.

Nevertheless, in line with the sustainable development strategy, the company is constantly integrating its business plans with activities limiting the impact of the company on the environment. By 2025, the Polish manufacturer wants to reduce CO2 emissions by 15%. In order to attain this goal, it carries out further investments, including the implementation of “green solutions” in its buildings. On the roof of the newly built LPP Distribution Centre in Brześć Kujawski, 4000 photovoltaic panels with a total power of 1.5 MW have been installed, which will supply the facility with solar energy. The company also relies ecological sources in other facilities – according to the letter of intent signed with FIGENE Energia, as of 2023 most of the office buildings and the Distribution Centre in Pruszcz Gdański will be powered by energy from wind farms for the next 10 years.

The consistent implementation of the strategy and transparent communication with the capital market in the area of sustainable development are reflected in the results of the latest corporate Climate Crisis Awareness study conducted by the Polish Association of Listed Companies, Foundation of Reporting Standards and Bureau Veritas Polska. Another year in a row, LPP has found itself among the leaders, taking the 3. place out of 153 companies listed on the Warsaw Stock Exchange.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collections on 26 stationary markets, including in such prestigious capitals as London, Helsinki, Tel Aviv or Moscow. The online offer is available on 31 markets. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. The company has a chain of over 2000 stores with the total area of over 1.6 million sq.m. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP debuts in North Macedonia. The Polish clothing manufacturer’s stores are already available on 26 markets.

On 23 September the Gdańsk-based company opened its first Reserved store in Skopje, making its debut on the Macedonian market. In a few weeks’ time the stores of its other brands will be launched, therefore expanding the LPP sales network in the Balkans by 8 thousand sq m. North Macedonia is the seventh country in South-Eastern Europe where the Polish clothing manufacturer operates stationary sales. The SEE region is a market with great development potential for the brands owned by LPP and one of the company’s three key sales regions.

The debut of LPP brands in North Macedonia, originally announced for 2020, was eventually postponed to the third quarter of 2021 due to difficulties caused by the pandemic. This is another step by LPP towards strengthening the standing of Polish brands on the map of South-Eastern Europe. Entering the Macedonian market, the company focused on the largest and best-located shopping centres in the capital of Northern Macedonia – Skopje City Mall and Skopje East Gate.

On 23 September the first Reserved flagship store was opened, with an area of over 1,900 sq m. It is the only store of the Polish manufacturer located in Skopje City Mall, situated 3 km from the very centre of the city. The complex comprises offers of 150 shopping and service points, creating a convenient atmosphere for combining shopping, entertainment and social meetings.

In a few weeks, the company will launch another five stores of its brands, including the second Reserved store, in the newly built Skopje East Gate shopping centre. The facility, which is the biggest private investment in North Macedonia, will be one of the largest shopping centres in the area. The 500,000 sq m area will include residential, office, retail and entertainment space. Of the 220 brands available at Skopje East Gate, up to 40% will debut in North Macedonia with the opening of the centre, offering customers a new shopping experience.

– Entering the Macedonian market is the next stage of LPP’s development in South-Eastern Europe, which we treat as a market that offers our brands growth potential. We are glad that after a year of wait time caused by the pandemic, which forced us to postpone our development plans in North Macedonia, the moment has come for the debut. Expanding the portfolio of our sales network to include the Macedonian market was a natural step in our strategy to gradually strengthen the position of LPP brands in the Balkans. – comments Przemysław Lutkiewicz – Vice-President of the Management Board, LPP.

LPP brand stores in Skopje have been prepared according to the latest architectural concept. Their total retail space will amount to over 8,000 sq m.

The expansion of LPP in the Balkans started 14 years ago with the launch of the first Reserved store in Romania. Since then, the Polish clothing manufacturer decided to launch stationary sales also in Bulgaria, Croatia, Serbia, Slovenia, and Bosnia and Herzegovina. Today, after entering the Macedonian market, the company’s stores in this region amount to nearly 180 stores with a total area of over 158,000 sq m. LPP additionally conducts online sales in the region, including on the Romanian, Croatian and Slovenian markets, and for several weeks now also in Bulgaria.

– Despite the continued double-digit growth of online sales, we still maintain our plans for the expansion of our traditional network, which we plan to increase by 25% this year. In our opinion, this is a good direction of development that will allow us to strengthen our multi-channel sales strategy. We are committed to providing our customers with the best possible shopping experience, regardless of whether they choose to purchase our collections in traditional stores or online – adds Przemysław Lutkiewicz – Vice-President of the Management Board, LPP.

According to the plans adopted by LPP for this year, the company intends to allocate PLN 950 million for the expansion of its stationary network, including, to the greatest extent, the development of stores in Europe and the CIS region.

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collection in traditional stores already on 26 markets, including in such prestigious capitals as London, Berlin, Tel Aviv or Moscow. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. As at the end of 2020, the company had a chain of over 1800 stores with the total area of 1.4 million sq.m. The online offer of the brands collections is available on 31 markets. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

SAVE THE DATE: LPP’s 2Q21/22 videoconference, 6th October, 12.00 pm CEST

Dear Sir or Madame,

LPP, the leading CEE fashion company, has the pleasure to invite you to participate in its videoconference, on Wednesday, 9th October, 12.00 pm CEST.

The CFO, Mr Przemysław Lutkiewicz, will comment on the company’s 2Q21/22 numbers and developments.

Videoconference in English will be available under the following link:

https://platforma.livingmedia.pl/lpp/210422003/

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LPP is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For 30 years it has been successfully operating in Poland and abroad, offering its collection in traditional stores already on 25 markets, including in such prestigious capitals as London, Berlin, Tel Aviv or Moscow. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay. As at the end of 2020, the company had a chain of over 1800 stores with the total area of 1.4 million sq.m. The online offer of the brands collections is available on 30 markets. On the basis of a global supply chain, the Polish clothing producer distributes over 259 million pieces of clothing to three continents. LPP plays another important role as it employs nearly 22 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. The company is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.