Wyniki finansowe LPP SA - Wiceprezes Przemysław Lutkiewicz

Beginning of year above expectations for LPP: double-digit sales growth and double-digit LFL level

• In Q1 2019, the Polish clothing producer exceeded PLN 1.8 bn in revenue, recording an increase by 15.7% y/y.

• Despite the high base of the previous year, the company increased its LFL sales by 11.4%.

• LPP maintains an upward trend in e-commerce, among others due to the extension of the offer to new countries.

• According to the plan, in 2019 the company wants to exceed PLN 1 billion in e-commerce sales.

In Q1 2019, LPP generated over PLN 1.8 bn in revenue and increased sales by 15.7%. A good beginning of the year of the Polish clothing manufacturer is due to the positive sales results in all five brands, as well as the effect of maintaining the growth of sales in e-commerce. In Q119, online sales increased by 47% y/y and already constituted 12.0% of revenues from Poland and 10.5% of the Group’s sales.

– We are pleased that all our brands recorded better sales results than in the previous year. The more so as the beginning of the year is usually the most difficult for the fashion industry. It is yet another quarter which shows that LPP is developing in the right direction. We have been consistently working on the quality of our collections and investing in the further development of the omnichannel. Multi-channel sales allow us to get to know our customers better and precisely identify trends, and our designers can use this knowledge to prepare collections that cater to the needs of our customers. We are particularly pleased with the next successful quarter of House and Reserved brands – comments Przemysław Lutkiewicz, Vice President of LPP.

In accordance with the adopted omnichannel strategy, the company focuses on the development of e-commerce and at the same time strengthens the potential of its own chain of brick and mortar stores. At the end of Q1 LPP operated 1724 stores, and the area of the chain increased by 8.4% y/y. In Q1 of this year, the company managed to reduce the costs of its own stores per square meter by 5 p.p. compared to the previous year. Despite significant investments in the development of e-commerce and rising logistics costs resulting from the development of this channel, LPP reduced total SG&A/m2 costs by 2 p.p. per year. The Polish clothing manufacturer continues the process of quality development of the chain of brick and mortar stores, focusing on increasing the size and modifying subsequent stores, which has an impact on cost optimization. The larger area of the store is also conducive to better display of goods.

– Despite the high base from the previous year, LFL sales grew much above our earlier expectations, by as much as 11.4%. This data show that revenues of LPP are growing not only due to the opening of new locations, but also due to the fact that existing stores are able to generate more and more revenue. We are pleased with the good sales dynamics on foreign markets, especially in Eastern and Southern Europe. We are a Polish company with global aspirations and it is abroad that we see an opportunity for further development. That is why we are not slowing down the pace and we are planning further openings – announced Przemysław Lutkiewicz.

At the end of Q1 of this year, LPP was conducting sales activities on 24 markets. At the turn of March and April, Bosnia and Herzegovina joined the chain of brick and mortar stores and the company launched stores of all five brands in that country. This year’s plans include a debut in Finland, the launch of an e-store in Ukraine and a pan-European e-store. A turning point in the development of multi-channel sales and global supply chain management will be the implementation of the RFID system. Currently, a team of several dozen trainers conducts trainings for employees of Reserved stores in Poland on the use of electronic tags. Here, the RFID implementation will be completed this year, and in the following years it will include the remaining brands.

Simultaneously, LPP invests in the development of an integrated logistics system, adjusted to the multichannel sales model. This year it wants to launch Fulfillment Center for e-commerce in Romania and in Q1 2020 in Slovakia. The company is also preparing to commence the construction of a distribution centre in Brześć Kujawski worth approximately PLN 500 million.

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LPP SA is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years it has been successfully operating in Poland and abroad, offering its collections already on 24 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. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 12 European countries. On the basis of a global supply chain, the Polish clothing producer distributes over 200 million pieces of clothing to three continents. LPP plays another important role as it employs over 25 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 rozbudowuje sieć dystrybucji i rozpoczyna program społeczny

LPP expands its distribution network and launches a social programme called “Brześć in the spotlight”

The Polish clothing manufacturer intends to open a new Distribution Centre in Brześć Kujawski in the first half of 2022. Already next year a multi-stage recruitment process will commence. Simultaneously with the progressing design works, LPP is involved in local development and strengthens cooperation with the local government of Brześć Kujawski. Within the framework of the partnership the Pomeranian investor will support sports initiatives and an educational programme aimed at the youngest inhabitants of the municipality.

– We have an important stage of the investment in Brześć Kujawski ahead of us, namely the execution of a multi-sectoral concept of the facility, i.e. one that will allow us to define the assumptions of the project in terms of functionality, space and technology. We are at the stage of selection of architects and, at the same time, the designer and supplier of logistics technology. We want both projects – the architectural and technological ones – to be executed in cooperation, which will allow us to design a facility tailored to the needs of LPP, where advanced technologies will be used on a daily basis and the highest standards of work and safety will be ensured – comments Jacek Kujawa, Vice President of LPP for Logistics and IT.

According to the plan, the concept of the Centre in Brześć Kujawski is to be developed by the end of this year. In the first half of 2020, a tender for the execution will be announced and the construction stage will begin. The final stage of the construction works and the commencement of the logistics technology assembly are planned for the first half of 2021. The final stage will be the launch of the logistics technology, which will take about a year. The first shipments of LPP products from Brześć Kujawski off to the other parts of the world will start in the first half of 2022.

The investment worth about PLN 500 million will allow to increase the current warehouse space of LPP by 100 thousand m2. Up to 10 million pieces of clothing and accessories will be shipped weekly from the new Distribution Centre to LPP stores around the world. The Polish manufacturer intends to employ several hundred people to provide logistic services to the chain of stores in Poland and abroad. The company will recruit warehouse workers, maintenance specialists, logistics employees, engineers and managers. The multi-stage recruitment process will begin in 2020.

– As a company responsible for employees and future generations, we want to be present in Brześć Kujawski not only as an investor creating several hundred jobs, but also as a good neighbour. Therefore, we signed a letter of intent with Brześć Kujawski municipality in which we declared our willingness to undertake joint activities for the benefit of the residents and the municipality, especially in the areas of education, culture and recreation. We are very happy that thanks to the cooperation with the authorities of Brześć Kujawski we will be able to support local development, encourage residents to take part in sports activities and educate children and youth – comments Przemysław Lutkiewicz, Vice President of LPP responsible for Finance.

The inauguration of the social programme of LPP called “Brześć Kujawski in the spotlight” will accompany this year’s edition of the Czesław Wasielewski Memorial organized by the Municipal Sports Club “Łokietek” and employees of the company from the LPP Team’s participation in the run. Moreover, as part of a long-term partnership with the Municipality of Brześć Kujawski, an educational programme will be launched in the 2019/2020 school year. Primary school pupils in the municipality will be able to take part in English language classes.

– From the next school year on, in cooperation with LPP, we will initiate an educational programme that will help develop language skills of children and youth from our municipality. I believe that our partnership within the framework of the “Brześć in the spotlight” programme will be long-term and will have a positive impact on the lives of the inhabitants. I am glad the group of investors operating in Brześć has been joined by a company for which family values are important and which willingly engages in local development – comments Tomasz Chymkowski, Mayor of Brześć Kujawski.

The inhabitants of Pruszcz Gdański, where over a decade ago LPP created its Distribution Centre – today one of the largest and most modern in Central and Eastern Europe – could already see how the investor’s involvement translates into the development of the local community and entrepreneurship. Currently, Pruszcz Gdański is among the most attractive investment destinations in the Pomeranian Voivodeship. Over the last 10 years, the region has also seen a significant drop in unemployment rate. Due to the dynamic development and planned further foreign expansion, the Polish manufacturer decided to make another investment on the scale of Pruszcz Gdański and to build a modern Distribution Centre in the territory of Brześć Kujawski municipality. Such facilities play a key role in the global supply and distribution network of LPP.

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LPP SA is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years it has been successfully operating in Poland and abroad, offering its collections already on 24 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. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 12 European countries. On the basis of a global supply chain, the Polish clothing producer distributes over 200 million pieces of clothing to three continents. LPP plays another important role as it employs over 25 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 SA - Salon Reserved w Bośni i Hercegovinie 1

Polish LPP has already been operating on 24 markets: the clothing manufacturer from Pomerania debuts in Bosnia and Herzegovina

At the end of April LPP launched the first Reserved store in Banja Luka, thereby confirming the debut of its five brands in Bosnia and Herzegovina. The network of brick and mortar stores of the Gdańsk company expanded by 24th market and the number of stores in the Balkan countries exceeded 100. LPP strengthens its position in South-Eastern Europe, which the company considers as one of the three most important regions in terms of sales.

Banja Luka is one of the two largest cities in Bosnia and Herzegovina with a population of approximately 200,000. LPP opened its stores of the total area of 5500 sq. m. in Delta Planet shopping mall. The end of March saw a debut of Mohito, House and Cropp brands in that location with the rest of the LPP brands joining them in the following month. The official opening of the flagship store of the Polish brand Reserved took place on 25 April. The women’s, men’s and children’s lines have been displayed on the total area of 2,306 sq.m. As a company that cares about ecological approach to fashion, LPP wants to hit a chord with Bosnian customers with, among other things, clothes made of environmentally friendly materials.

– The debut in Bosnia and Herzegovina is another step in order to strengthen our position in the region. We already have experience gained in neighbouring markets where our brands are becoming more and more popular and record dynamic sales growth. This has led us to take the bold steps and present our offer of all five LPP brands in this country. I believe that the recognition of our brands in this region will become a strong support for the mall format debuting in Banja Luka – comments Sławomir Łoboda, Vice-President of LPP.

The expansion of the Gdańsk company in the Balkans began in 2007 with its debut in Romania. A year later LPP opened its first stores in Bulgaria. Currently this part of Europe is one of the key areas for the development of the Polish company’s brick and mortar stores network. In September last year LPP opened stores in Slovenia, which is the fifth largest market in the Balkans. The important role of the region is also evidenced by the dynamic growth of the retail space. Only in the last quarter of 2018, a Polish clothing manufacturer increased the space of its stores in the Balkans by over 5,000 sq.m. in Serbia and over 4,000 sq.m. in Romania.

– We are a creative company from the Polish region of Pomerania, every year making a debut on a new foreign market. We bring along Polish technological solutions of our developers in Gdańsk and well thought-out concepts of showrooms developed by Polish architects. For several years we have been consistently exporting Polish know-how and creativity. Bosnia and Herzegovina is already the sixth market in the Balkans which will have the opportunity to get acquainted with our Polish creative ideas and exciting fashion collections of our designers – comments Vice-President Łoboda.

The Pomeranian investor plans to further develop its chain of stores in the Balkans. The company stresses that this is an important region also in the context of the development of e-commerce sales of the group, which shows high growth dynamics in these markets. The scale of LPP’s operations in this region already requires the support of a distribution centre – hence our decision to lease a warehouse in Romania. According to the plan, the new distribution centre will have been opened by the end of 2019. Ultimately, it will support the development of e-commerce of LPP in South-Eastern Europe. A month ago, the Polish manufacturer also extended its range of online sales by Croatia.

A dynamic development in the Balkans is an important stage in building global recognition of all brands of the Polish clothing manufacturer. The plans for the second half of this year also involve a debut of LPP in Finland – the company’s first market in Northern Europe.

           

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LPP SA is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years it has been successfully operating in Poland and abroad, offering its collections already on 24 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. The company has a chain of 1,760 stores with the total area of over 1 million sq.m. and operates online stores in 12 European countries. On the basis of a global supply chain, the Polish clothing producer distributes over 200 million pieces of clothing to three continents. LPP plays another important role as it employs over 25 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 SA - Magazyny PNK PARK SERED - Słowacja 8

LPP, a Polish clothing manufacturer effects one of the biggest warehouse lease transactions in Slovakia.

LPP leases 25,400 sq. m from PNK Group in PNK Park SEREĎ. Within 3 years, the leased area will be increased to 32,700 sq. m.

LPP, the biggest Polish clothing manufacturer in Central and Eastern Europe (owner of five fashion brands: Reserved, Cropp, House, Mohito, and Sinsay) in line with its development strategy for the coming years, leased 25,400 sq. m of industrial space from PNK Group in PNK Park SEREĎ in Slovakia. The contract provides for an option to lease another 7,300 sq. m in the same building within three years. Therefore, the company could occupy the entire second building of the PNK Park SEREĎ with an area of 32,700 sq. m. JLL, a leading real estate consultancy company acted as a consultant for the preparation and execution of this lease contract which is one of the biggest transactions recently recorded in the Slovak market.

LPP will use this building as an e-commerce Fulfillment Center which will serve, besides Slovakia, the entire region of Central Europe. The company will focus on the automation of the warehouse processes in order to ensure high efficiency and shorten lead times. It is also planned to equip the facility with modern offices and a canteen to safeguard the best working conditions for the employees.

“We are pleased that such an important market player as LPP has chosen our industrial park. We managed to rent out the industrial buildings constructed in 2018 in just over six months,” said Azamat Yerzhanov, Partner of PNK Group Europe. “The transaction with LPP entails the possibility to lease 7,300 sq. m in the finished building in PNK Park SEREĎ for a three-year term”.

“The decision on leasing a new warehouse in Slovakia, which will serve as an e-commerce Fulfillment Center, is an integral part of our strategy concerning development of the international distribution network. The location and the facility itself have been carefully selected, in close cooperation with JLL Slovakia. They meet several criteria, such as: proximity to the LPP’s key markets, availability of workforce and technical specification of the building allowing for implementation of the state-of-the-art intralogistics technology and automation of the Fulfillment process in the near future”explains Piotr Dopierała, LPP Logistics Director.

At present, LPP’s online stores are served by Fulfillment Centers in Gdańsk, Stryków and Moscow and their total industrial space amounts to over 70,000 sq. m. Soon, the network will be extended by a warehouse in Romania (22,000 sq. m), which is currently under construction.

“The new Fulfillment Center in Slovakia will play a crucial role in LPP’s distribution network, ensuring the highest standard of service to the customers of our online stores not only in Slovakia, but also in the Czech Republic, Hungary, Slovenia, Croatia and Bosnia and Herzegovina. This investment will soon allow us to offer all customers of our five fashion brands on these markets, the next business day deliveries and even same day deliveries in a few locations. This, in turn, will help the company to significantly boost its competitiveness.”adds Piotr Dopierała.

The new warehouse will create jobs for several hundred people. The Polish clothing manufacturer, currently employing over 25 thousand people on three continents, is known for its long-standing commitment to ensuring high standards of working conditions for its employees. This time will be no exception. LPP, in cooperation with PNK Group and JLL (Tétris), has already started working on modern solutions in this respect in its new warehouse in Slovakia. According to the Company, these conditions will reflect the highest world standards.

“LPP has chosen Slovakia because we were able to present a highly competitive and quality product which can easily compete with the most modern logistic properties across Europe. This transaction is not only significant by its proportions, but it also sends a very positive signal that the Slovak logistic market does not have to be solely dependent on the companies from the automotive industry starting their operations and growing their business there. To bring such a significant player, its strategic operations and not to mention new important employer to Slovakia, makes our team very proud,” – adds Samuel Šporka, Head of Leasing at JLL Slovakia.

Located near the R1 expressway, the PNK Park SEREĎ has convenient and easy access to Bratislava (55 km) via D1 highway and good road transport links to Austria, Hungary and the Czech Republic. Besides two ready-made facilities, the park will consist of three buildings with a total area of 227,000 sq. m. which are suitable to be used as warehouses, distribution centers, and for light industrial purposes as well. The buildings are made entirely of reinforced concrete frames. The industrial facilities have a BREEM pass certificate and comply with FM Global international property insurance standards.

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About LPP SA

LPP SA is a Polish family business and one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years it has been successfully operating in Poland and abroad, offering its collections already on 24 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. The company has a chain of 1,760 stores with the total area of over 1 million sq.m. and operates online stores in 12 European countries. On the basis of a global supply chain, the Polish clothing producer distributes over 200 million pieces of clothing to three continents. LPP plays another important role as it employs over 25 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.

www.lppsa.com


About PNK Group

PNK Group offers a full implementation cycle for turnkey industrial facilities both on the client’s premises and in PNK industrial parks. The company has been operating since 2004 and its portfolio consists of 29 industrial parks in Europe, Russia, and the USA with a total area of the facilities commissioned and in various phases of construction amounting to over 5 million sq m.

About the PNK Park SEREĎ – see http://pnk.group/park/sered.html


About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 90,000 as of December 31, 2018. JLL is the brand name and a registered trademark of Jones Lang LaSalle Incorporated. For further information, visit jll.com. JLL Slovakia was established in 2006. Currently, it provides services in the field of investment consultancy (capital markets), valuation, research, land investment and development, leasing of office, industrial and retail space as well as the services in the field of property and project management. JLL’s Capital Markets team has the largest track-record by the number of deals and investment volume from all the agencies on the Slovak market. In the last 12 months, JLL represented its clients in property transactions worth more than Eur 325 mil.

Wyniki finansowe LPP SA - Wiceprezes Przemysław Lutkiewicz

Record profits and over 8 bn revenues recorded by LPP in 2018

• The Polish clothing manufacturer summed up another successful year: total sales of LPP in 2018 increased by 14.5% y/y and exceeded PLN 8 bn.

• In 2018, the company achieved the highest net profit in its history at the level of half a billion zlotys.

• The company’s revenues increased due to LFL growth and doubling of online sales. The company estimates that in 2019 its revenues from e-commerce will exceed PLN 1 bn.

• The most important event of 2018 was the creation private foundations by the founders of LPP and the transfer of the company’s shares to them, which is a guarantee that LPP will remain a Polish company forever.

In the last quarter of 2018,LPP exceeded two billion in revenues. A good year end for the Polish clothing manufacturer is due to the hit autumn/winter collections – in particular the Reserved and House brands, as well as further increases in online sales. Throughout 2018, the company generated over PLN 8 bn in revenue.

Positive impact of the omnichannel

– The past year was definitely a very successful one – we generated half a billion net profits and our revenues are growing at a double-digit rate. We had a very good first half of the year and managed to maintain our margins at 54.7% per year. Regardless of the fluctuations resulting from the sale offers, we achieve increasingly better margins, which we owe to successful collections and the ability to precisely match the offer to the needs of customers. We want to maintain this trend in 2019 – comments Przemysław Lutkiewicz, Vice President of LPP responsible for Finance.

Year by year we can see the growing importance of e-commerce in the structure of revenues of the Gdańsk-based company. In Q4 2018, online sales constituted as much as 12.3% of revenues from Poland and 10.6% of the group’s sales. The core of the LPP strategy is all about tapping into the potential of the expanded brick-and-mortar store chain and the dynamic development of online sales, therefore the company focuses on the integration and development of both channels. At the same time, it is working on the qualitative change of the chain of over 1760 stores and expanding the e-commerce outreach to other countries. The turning point in the development of multi-channel sales and global supply chain management will be the implementation of RFID in Reserved chain, planned for 2019, which in the following years will include the remaining brands.

LPP investments for the years to come

In 2018, the retail space of the LPP brick-and-mortar chain increased by 9% and in the second half of the year the share of the LPP retail space abroad exceeded half out of over one million square meters. Within just three months, a clothing manufacturer from Gdańsk debuted on three new foreign markets – in Israel, Slovenia, and Kazakhstan. The company also strengthens its position in existing locations. This is evidenced by the LFL growth in sales which amounted to 7.2% y/y.

In 2019, the company is planning to enter two new markets – Bosnia and Herzegovina and Finland. By the end of 2019, the company intends to make its offer available online in every EU Member State and in Ukraine. The stable financial situation and the profit generated in 2018 will allow the company to further improve its logistics processes and invest in the development of its sales network. In total, by 2020, LPP wants to allocate half a billion for logistics centres. In 2019, the company is planning to complete the investment project concerning the e-commerce warehouse in Romania. At the turn of 2021 and 2022, the distribution centre in Brześć Kujawski will become one of the two key elements of logistics of LPP, thanks to which the company’s warehouse space will be increased by 100,000 m2 and over 1000 people will find employment there.

– Significant expenditures on the expansion of distribution centres is an investment not only aimed at increasing our logistics capabilities and improving the quality of customer service, but also a significant contribution to the Polish economy. That is why the decision of the owners to establish private foundations was so important to maintain the strength of our company. The succession process initiated in this way by Marek Piechocki, President of the Management Board, is a guarantee that the company founded by him in Pomerania will last for years or even generations. Hence, we will continue to support Polish creative thought and maintain employment for several thousand employees and hundreds of contractors – comments Przemysław Lutkiewicz.

LPP SA - Nowe centrum dystrybucyjne w Pruszczu Gdańskim

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LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

LPP summarises its first year on Oxford Street

• The Reserved store in London generated over £10 m of revenue, selling more than 700,000 pieces of clothing during the year.

• On average, customers purchased 54,000 products in the store every month.

• One year after its debut on Oxford Street, LPP established cooperation with Vogue magazine. This is yet another step towards building global recognition of the Reserved brand.

– In order to expand into different areas of the world, we need to make foreign customers, who visit the most important shopping streets of Europe, aware of our brand in the first place. For us, London is one of these significant locations. The results achieved during the first year of opening the store in the capital city of the United Kingdom are in line with our expectations. In places like Oxford Street, the competition is fierce, and it is difficult to instantly achieve spectacular results. We wanted the Reserved brand to be noticed and we have certainly accomplished that. Last year’s debut was a breakthrough moment that has allowed us to be much bolder when choosing new locations for our stores – Przemysław Lutkiewicz, Vice President of the LPP Board.

Since its opening in the autumn of 2017 to the end of September this year, the store generated over £10 m of income. At the same time, the Gdańsk-based manufacturer has launched an online store for its flagship brand on the British market. – Thanks to our presence on Oxford Street, we get an insight into the preferences of international customers. During the course of this year, online sales were another important source of knowledge about customer experiences and expectations. In comparison to other markets, this one exhibits a higher interest in premium lines, as well as capsule collections – Przemysław Lutkiewicz Vice President of the LPP Board.

The debut of Reserved on one of the most important shopping streets in Europe attracted crowds of customers. A year after this event, the Polish company’s premier store in Britain still continues to arouse interest among Oxford Street shoppers. One of the reasons for that is the launch of its latest collection, co-created with the British editors of Vogue magazine.

– It is not enough for a brand to simply appear on such a demanding market to attract the customers’ attention. Yet, we have been noticed by customers from the very first step, due to the grand opening with Kate Moss, as well as the spring campaign with Cindy Crawford. A whole year of hard work on making our brand more recognisable on the British market is behind us. We have set the bar very high and we are doing our best to maintain this level of quality. We like new challenges and as such, 2018, our first year on Oxford Street will culminate in a joint collection with Vogue magazine, a source of inspiration for our customers around the world – Monika Kapłan, Reserved Marketing Director.

In recent months, the editors of Vogue have been working on our unique New Year collection – ‘Curated by British Vogue’ – together with designers from the Reserved studio in Warsaw. The collection was launched on 6th December this year, and it is available in selected brand stores, as well as the online store. The project itself met with great interest even before its launch, including in places outside the UK and Poland. This was made possible thanks to a wide-ranging marketing campaign carried out in both traditional media as well as online, and also thanks to promotional events advertising the collection, that were organised in Warsaw, London and Hamburg.

One of the key elements of the strategy to increase the recognition of the Reserved brand is international campaigns with the participation of well-known personalities from the world of fashion and art. In the autumn and winter seasons, a Polish/French duo, consisting of the Polish actress Joanna Kulig and the French influencer and model Jeanne Damas, have become the faces of our collection. The ‘I Can Boogie’ campaign and its dancing mood have also appeared in London – the Reserved store has attracted the attention of many Oxford Street shoppers thanks to its original combination of art and fashion. Instead of the usual static mannequins, a dynamic composition referring to the aesthetics of the collection and the themes of the campaign has been created.

Building a recognisable brand is vital, but the appropriate arrangement of the space within the store is equally important. The Oxford Street store exceeds 3,000 sq. metres. The entire display is located on one floor, and thanks to the ‘Open to Public’ concept of Reserved stores, everything is in the line of sight, as well as in reach of the customer. Considering the expectations of customers, such a store is a ‘must have’, not only in Western Europe but in all key locations, such as the Złote Tarasy shopping centre in Warsaw. The sales network of all LPP brands, as of today, includes more than 1,700 stores. The one located on Oxford Street has proven to be the best place to test new concepts. – The solutions that work in intercultural and vibrant cities such as London, tells us how we should change and what would be worth implementing in our stores, both when it comes to Reserved, as well all other LPP brand stores in the world – Przemysław Lutkiewicz, Vice President of the LPP Board.

Today, the flagship brand of LPP – Reserved – is present in 23 countries. In 2019, the Polish company will expand into Bosnia and Herzegovina, as well as Finland. During the next year, LPP also plans to make its collection available through the Internet to customers from all European Union member states.

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LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

Contact for the media:

Monika Wszeborowska
PR Manager
Phone number: +48 519 010 990
E-mail: monika.wszeborowska@lppsa.com

Sławomir Ronkowski
Director of Communications and Sustainable
Phone number: +48 571 448 369
E-mail: slawomir.ronkowski@lppsa.com

www.lppsa.com

LPP exceeded 2 bl revenue in Q3 2018

• Since the third quarter of this year, the retail space of LPP’s brick-and-mortar stores abroad has already accounted for more than half of the company’s total retail space

• In the third quarter, the Company recorded over PLN 2 bl in revenue – 12.8% more than in the previous year. In the first nine months of this year, LPP generated PLN 5.7 bl, which means an increase by 16.3% y/y.

• The Company achieved a positive LFL and a three-digit increase in e-commerce sales y/y.

• In the last three months, the Company made its debut on three foreign markets. In the third quarter it launched sales in Israel and Slovenia, and in October opened a store in Kazakhstan.

LPP ends another quarter of this year with a result of over PLN 2 bl in revenue. As a result, total sales of the group for the first nine months of this year exceeded PLN 5.7 bl. This is primarily the effect of an increase in LFL, an increase in the retail space of the brick-and-mortar chain, and a high dynamics of online sales.

– The results achieved in the third quarter prove that our strategy is correct. Every month, from August to October, we debuted on one new foreign market. We recorded a significant increase in gross margin, despite the sales offers in this period. Customers’ attention was attracted by very good AW collections, in particular by Reserved and Sinsay. We are also satisfied with the House collection, which closed the third quarter with a double-digit increase in sales – comments Przemysław Lutkiewicz, LPP’s Vice President of the Management Board for Finance.

The gross margin of LPP in the third quarter of 2018 reached 51% and is 2 p.p. higher than a year ago. Compared to the previous year, the Company also reduced the costs of its own stores per square metre. This is a result of the introduction of new, larger store formats and the renegotiation of existing agreements with shopping centres. In the first nine months of 2018, the Company generated a net profit of PLN 193 m, recording an increase by 36.5% y/y.

– The development entails the need for investment, therefore in order to maintain the current dynamics we have been allocating further funds for the development of our stores, logistics and e-commerce – comments Przemysław Lutkiewicz. In the third quarter of 2018, LPP’s capital expenditure totalled PLN 210 m, of which nearly 60% was earmarked for stores. The remaining funds were invested, among others, in expansion of the distribution centre in Pruszcz Gdański, construction of the centre in Brześć Kujawski and expansion of the Company’s head office.

Sales results in the third quarter of this year confirm that Poland remains the most important market for the group. In line with the LPP strategy, the Company is simultaneously developing its sales network outside the country and increasing revenues from operations on foreign markets. Already now, the share of LPP retail space abroad accounts for more than half of the group’s total retail space. In addition to the dynamic growth in Europe, LPP has also increased sales in the Middle East – the debut of Reserved in Israel contributed to the strengthening of its image in this region. The Company also intends to continue its development in Southern Europe.

– Following the September debut, Slovenia is already the fifth country in Southern Europe where LPP brands’ stores are present. We are satisfied with the results so far in this region. To begin with, we opened a Reserved store in Slovenia, and we are planning to open more stores of our brands. The scale of LPP’s operations in this region already requires the support of a distribution centre – hence our decision to lease a warehouse in Romania – comments Vice-President Lutkiewicz. The new distribution centre in Romania will ultimately support online sales of LPP in South-Eastern Europe.

Online sales in the third quarter of this year accounted for 8.3% of revenues from Poland and 7.4% of the group’s sales. At the same time, the Company maintains its declaration to increase the share of e-commerce to 20% of total sales by 2021. LPP wants to achieve this, among other things, by expanding its offer to new countries – by the end of the first half of next year it intends to make its offer available via the internet in every EU Member State. In 2019, the brick-and-mortar network of the Polish company will be expanded by another country in the Balkans – Bosnia and Herzegovina and Finland in Northern Europe. Following its debuts in the last three months, LPP is already present in 23 countries.

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LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

Contact for the media:

Monika Wszeborowska
PR Manager
Phone number: +48 519 010 990
E-mail: monika.wszeborowska@lppsa.com

Sławomir Ronkowski
Director of Communications and Sustainable
Phone number: +48 571 448 369
E-mail: slawomir.ronkowski@lppsa.com

www.lppsa.com

LPP founders awarded ‘Golden Oxer’ by Pomeranian Employers

Marek Piechocki and Jerzy Lubianiec , LPP founders, were granted the Golden Oxer award by Pomeranian Employers. The biggest and oldest employers’ organisation operating in the territory of the Pomeranian Voivodeship awarded the company founders for their vision, consequence and determination in building their business.

As every year, the Pomeranian Employers organisation held a festive gala – Evening Gala – during which it granted the statuettes to the best, the most innovative and the most socially sensitive entrepreneurs in the Pomeranian area. LPP founders – Marek Piechocki and Jerzy Lubianiec – were among the awarded and the organisation decided to honour them with the Golden Oxer – a special award for outstanding accomplishments and overcoming barriers in building the business.

In the justification, the Pomeranian Employers’ Council emphasised the exceptional accomplishments of the LPP founders who, building their business from scratch, have demonstrated developmental vision and consistency in the implementation of the set strategic goals. Owing to that, and also thanks to their knowledge and experience they created a company which is the pride of the Pomeranian region, and a renowned Polish and European brand.

Sławomir Łoboda, Vice-President of the Management Board of LPP, collected the award on behalf of the laureates. – LPP has received numerous awards, including very prestigious ones, but this one is particularly precious to us – if not the most precious – as it is granted by Pomeranian Employers which is an organisation from our local environment, where LPP headquarters are located and where the heart of company beats. Therefore, we are particularly proud that Pomerania notices and rewards our efforts – emphasised Sławomir Łoboda, receiving the award.

– LPP’s ambition is to further pursue the dynamic development of the company. We are operating in the context of constant change and the need to implement innovations. All that considered, we need to overcome multiple obstacles. We are proud that Pomeranian Employers believe that we have been dealing with these problems in a manner worthy of the Golden Oxer – added Sławomir Łoboda.

Photography: Anna Rezulak / KOSYCARZ FOTO PRESS / KFP / www.kfp.pl

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LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

Contact for the media:

Monika Wszeborowska
PR Manager
Phone number: +48 519 010 990
E-mail: monika.wszeborowska@lppsa.com

Sławomir Ronkowski
Director of Communications and Sustainable
Phone number: +48 571 448 369
E-mail: slawomir.ronkowski@lppsa.com

www.lppsa.com

LPP debuts in Kazakhstan

At the end of October, the Polish clothing company opened the first store of its flagship brand Reserved in Almaty, Kazakhstan. This is the 23rd foreign market, already announced last year, on which the Gdańsk company will develop its chain. The debut in Kazakhstan is yet another stage in the implementation of the international expansion strategy of LPP.

The first launch in Kazakhstan concerned the flagship brand, Reserved. The official opening of the first store took place on 31 October in Dostyk Plaza shopping centre, located on one of the main streets, at the very heart of the city. Garments from women’s, men’s and children’s collections are available on a total area of 2,385 sq.m. of the three-storey showroom.

The next openings, this time of House, Mohito and Sinsay brands, will take place on 21 November in A’port shopping centre. By the end of this year, customers of the shopping centre will also be able to visit the Reserved and Cropp stores. The total area leased by the company in A’port shopping centre will amount to over 4,800 sq.m., of which nearly half will be devoted to presentation of the Reserved offer. All stores will be located in the newly developed retail space of the centre.

– The opening of the stores in Kazakhstan is the next stage of our international expansion. We assume that every year our global turnover will increase by a dozen or so percent – such a growth would not be possible without new markets. Recently, the economy of Kazakhstan has been recording a very promising boost and the actions of private investors influence its systematic stimulation. This effect can also be seen in the recovery of the retail sector. Apart from the high demand, today it can benefit from an attractive offer of new retail spaces – comments Sławomir Łoboda, Vice-President of the Management Board of LPP.

This year’s debuts do not cool down the enthusiasm of the Gdańsk company as regards the Kazakh market. In 2019, LPP plans to open more stores of all brands in the capital Astana, this time in the Abu Dhabi shopping centre. The planned leased area will amount to nearly 4,600 sq.m.

LPP’s ambition is to enter at least one new market each year. The company’s presence in Kazakhstan is one of the stages in the development of its sales network in Central Asia and an important step in building global recognition of all brands of the Polish manufacturer. The plans for 2019 also include openings in Finland and Bosnia and Herzegovina.

 

______________________________________________________________________________

LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sq.m. and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

 

Contact for the media:

Monika Wszeborowska
PR Manager
Phone number: +48 519 010 990
E-mail: monika.wszeborowska@lppsa.com

Sławomir Ronkowski
Director of Communications and Sustainable Development Department
Phone number: +48 571 448 369
E-mail: slawomir.ronkowski@lppsa.com

www.lppsa.com

LPP signed a contract for the construction of a warehouse in Romania

The Gdańsk-based clothing manufacturer has signed a contract for the construction of a warehouse near Bucharest. Such a strategic location will enable the company to efficiently handle online sales of all brands in the area of South-Eastern Europe. The investment, which is planned to be completed in 2019, marks the next stage of implementation of the intensive development strategy of LPP in the area of e-commerce.

LPP entrusted the construction of the new distribution centre in Romania to a Belgian company – WDP Development. The 22,000 sqm warehouse will serve as the so-called Fulfilment Centre, dedicated to logistical support of online sales for all brands belonging to LPP. Ultimately, the new warehouse will handle orders throughout South-Eastern Europe.

– The development of our chain of brick-and-mortar stores in Poland and abroad and a significant increase in the share of online sales are challenges that require technologically advanced logistics facilities – says Jacek Kujawa, Vice President of the Management Board of LPP for logistics and IT. Romania is one of the most dynamically developing markets in our portfolio – we’ve been recording increasing sales figures of all our brands, especially in the e-commerce channel. An additional advantage of this location is the possibility of efficient service for the countries of South-Eastern Europe – adds Jacek Kujawa.

The investment near Bucharest is part of the development strategy of LPP for the coming years. One of its pillars is the development of its distribution system. Outside Poland, it will be the second distribution centre of the Gdańsk-based clothing manufacturer. Now, the company may pride itself on having warehouses with a total area of over 100,000 sqm in Pruszcz Gdański, Gdańsk, Stryków and Moscow. In the coming years, further development of the distribution network is planned and the warehouse space will be increased to over 270,000 sqm.

______________________________________________________________________________

LPP SA is one of the fastest growing clothing companies in the region of Central and Eastern Europe. For over 25 years, the Company has consistently carried out its operations in Poland and abroad, being successful on the demanding clothing market. LPP SA manages five fashion brands: Reserved, Cropp, House, Mohito and Sinsay. The company has a chain of 1,700 stores with the total area of over 1 million sqm and operates online stores in 11 European countries. LPP employs over 25 thousand people in its offices and sales structures in Poland, Europe, Asia, and Africa. LPP SA is listed on the Warsaw Stock Exchange in the WIG20 index and belongs to the prestigious MSCI Poland index.

 

Kontakt dla mediów:

Monika Wszeborowska
PR Manager
Phone number: +48 519 010 990
E-mail: monika.wszeborowska@lppsa.com

Sławomir Ronkowski
Director of Communications and Sustainable Development Department
Phone number: +48 571 448 369
E-mail: slawomir.ronkowski@lppsa.com

www.lppsa.com