Spanish fashion retailer Tendam’s core earnings up 10% as it mulls IPO

MADRID (Reuters) – Spanish fashion retailer Tendam reported on Thursday a 10% rise in core earnings for its 2023 financial year and forecast lower to steady first-quarter growth as the company mulls an initial public offering.

The owner of Women’s Secret, Cortefiel and Springfield chains said its recurring earnings before interest, taxes, depreciation and amortisation (EBITDA) reached 313.3 million euros ($340.8 million) between March 2023 and February 2024.

Spain’s third-largest fashion group after Zara owner Inditex and Mango said its revenues rose 6.5% to 1.29 billion euros, marking a slowdown from 2022, when most fashion retailers were still benefiting from a post-pandemic shopping spree.

Still, its gross margin rose by 1.2 percentage points to 62.5% in 2023.

Tendam said in a statement that based on preliminary data in the March to May period, like-for-like revenue grew by 6% from a year ago, while recurring EBITDA rose between 8.5% and 10.4%.

CEO Jaume Miquel said “the fiscal year 2024 has started very well”, keeping Tendam “excited about the growth opportunities ahead”.

Miquel told Reuters last month the Spanish IPO market seemed to be opening up following beauty group Puig’s market debut in May, Spain’s largest IPO in almost a decade, after which Puig’s share price rose about 6% in the first month of trading.

“With a view to stepping up this growth, the company continues evaluating potential strategic alternatives, including the possibility of an initial public offering of its shares on a regulated market,” Tendam added in Thursday’s statement.

Tendam’s equity value could reach between 2.2 billion and 2.7 billion euros, according to a research note by Bestinver.

The company, which has been owned by CVC Capital Partners Plc and PAI Partners since 2005 and has focused on expanding as a multi-brand retailer in recent years, said its results were largely due to good sales in Spain, Portugal and Mexico.

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It expects to increase sales by at least 5% this year.

($1 = 0.9193 euros)

(Reporting by Corina Pons; Editing by Andrei Khalip and Jan Harvey)