- Subdued demand and market overstock continue to severely
adversely impact the Company’s financial results and
liquidity
- Key restructuring measures include the termination or
winding down of non-performing assets, the rightsizing of
under-performing business units as well as the evaluation of
disposals of non-core assets
- In connection with the strategic realignment the Company
will delist its shares from the NYSE and terminate its SEC
reporting requirements
- The role of the current CEO of Internetstores, Torsten Waack
van Wasen, will be expanded to join the management team as Chief
Performance Officer (CPO) of the Group.
SIGNA Sports United N.V. (“SSU” or the “Company”), a specialist
sports e-commerce company with businesses in bike, tennis, outdoor,
and teamsports, today announced an acceleration of its strategic
realignment and performance enhancement program in light of
continuing macroeconomic headwinds, oversupply in the market and
the Company’s severe liquidity and profitability challenges.
The operating environment for the Company in the first nine
months of FY23 and thereafter was characterized by a continuation
of material disruptions which started in the second half of last
year. Although some economic indicators across core markets have
continued to improve slightly, the demand for the Company’s
products remains significantly below 2022 and pre-pandemic levels.
In addition, inventory levels across the industry remain elevated
as market participants still aim to clear excess inventory,
resulting in a material adverse effect on the Company’s gross
margins and increasing negative cash flows.
The Company’s management has responded to ongoing market
dynamics by undertaking a thorough review of the Company’s
operating model. Consistent with this initiative, and as a result
of the challenging macroeconomic environment, a sustained
oversupply in the Company’s relevant markets and the resulting
severe and materially adverse impact on the Company’s liquidity and
profitability situation, the Company’s Board of Directors has
resolved together with management to implement a transforming
strategic realignment, performance enhancement and downsizing
program for the Company and all of its subsidiaries with the aim of
returning the business to profitability and free cash flow
breakeven as soon as possible. The key performance enhancement
measures under consideration include the streamlining and
rightsizing of under-performing business units, the termination or
winding down of non-performing assets as well as the opportunistic
evaluation of disposals of non-core assets to strengthen the
company‘s distressed liquidity position and financial profile.
In addition, also taking into account the limited liquidity and
trading volume in the Company’s publicly listed shares since the
business combination in December 2021, the Company’s Board of
Directors has concluded that the benefits associated with being
listed on the New York Stock Exchange (“NYSE”) do not justify the
costs and demands of management’s time necessary to meet the
Company’s US regulatory commitments. Consequently, the Company’s
Board of Directors decided to immediately start the process to
delist the Company’s shares from the NYSE. It is expected that such
delisting will become effective on or around October 22, 2023.
After the NYSE delisting becomes effective, the Company intends to
promptly initiate the process for suspending its reporting
obligations under the US Securities Exchange Act of 1934, as
amended. The Company expects that the US deregistration of its
securities under the US Securities Exchange Act of 1934, as
amended, will become effective prior to December 31, 2023.
To support the accelerated realignment and performance
enhancement program the Board of Directors will extend the scope of
the duties of Torsten Waack van Wasen, CEO of Internetstores since
February 2023, to become part of the Company’s management team as
Chief Performance Officer (CPO) for the Group. Torsten Waack van
Wasen has many years of restructuring experience from his prior
positions, including at Alvarez & Marsal and Alteri Investors.
After expiry of the contract of the Company’s CEO Stephan Zoll in
the 1st quarter 2024, Torsten Waack van Wasen will follow him as
CEO of the Company.
The Company’s Board of Directors determined that the accelerated
broader strategic realignment and performance enhancement plan, in
conjunction with the NYSE delisting and suspension of US reporting
obligations, is in the overall best interests of the Company and
its stockholders.
Outlook & Guidance
Since announcing FY23 guidance, operating performance,
particularly in the Bike segment has continued to lag management
expectations. As a result of weaker consumer demand and elevated
promotional activity to rightsize inventory levels, SSU management
anticipates FY23 net revenue will fall below FY23 Guidance of (9)%
- (11)% and FY23 free cash flow may miss the low end of the
previously provided range.
As the Company enters FY24, it is the belief of SSU management
that the market disruptions associated with market overstock are
likely to persist into late FY24 and will adversely impact the
Company’s ability to achieve its near-term growth and profitability
targets. As a result, and in light of the upcoming accelerated
realignment and restructuring program, the Company is withdrawing
its previously stated mid / long-term guidance provided in H1
FY23.
About SIGNA Sports United:
SIGNA Sports United (SSU) is a specialist sports e-commerce
company with headquarters in Berlin. It has businesses operating
within bike, tennis, outdoor, and team sports. SSU has more than 80
online sites and partners with 500 shops serving over 6 million
customers worldwide. It includes Tennis-Point, WiggleCRC,
Fahrrad.de, Bikester, Probikeshop, Campz, Addnature, TennisPro and
Outfitter.
Further information: www.signa-sportsunited.com.
Forward-Looking Statements
These forward-looking statements include, but are not limited
to, statements regarding future events, the estimated or
anticipated future results and benefits of SSU following the
announced strategic realignment and performance enhancement
program, future opportunities for SSU, future planned products and
services, business strategy and plans, objectives of management for
future operations of SSU, market size and growth opportunities,
competitive position, technological and market trends, and other
statements that are not historical facts. Forward-looking
statements are generally accompanied by words such as believe,”
“may,” “will,” “estimate,” “continue,” “anticipate,” “intend,”
“expect,” “should,” “could,” “would,” “plan,” “predict,”
“potential,” “seem,” “seek,” “future,” “outlook,” “suggests,”
“targets,” “projects,” “forecast” and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. These forward-looking statements
are provided for illustrative purposes only and are not intended to
serve as, and must not be relied on, by any investor as a
guarantee, an assurance, a prediction or a definitive statement of
fact or probability. Actual events and circumstances are difficult
or impossible to predict and will differ from assumptions. All
forward-looking statements are based upon estimates and forecasts
and reflect the views, assumptions, expectations, and opinions of
the Company, which are all subject to change due to various factors
including, without limitation, changes in general economic
conditions as a result of the war in Ukraine, significant
inflation, higher financing costs, an increase in energy costs, a
negative consumer sentiment and COVID-19. Any such estimates,
assumptions, expectations, forecasts, views or opinions, whether or
not identified in this document, should be regarded as indicative,
preliminary and for illustrative purposes only and should not be
relied upon as being necessarily indicative of future results.
Forward-looking statements appear in a number of places in this
press release and include, but are not limited to, statements
regarding our intent, belief or current expectations.
Forward-looking statements are based on our management’s beliefs
and assumptions and on information currently available to our
management. Such statements are subject to risks and uncertainties,
and actual results may differ materially from those expressed or
implied in the forward-looking statements due to various factors.
The forward-looking statements in this press release may include,
without limitations, statements about:
- our liquidity and losses from operations and projected cash
flows and related impact on our ability to continue as a going
concern;
- our future financial condition and operating results;
- our ability to remain in compliance with financial covenants
under our financing arrangements;
- our ability to extend, renew or refinance our existing
debt;
- our growth, expansion and acquisition prospects and strategies,
the success of such strategies, and the benefits we believe can be
derived from such strategies;
- our ability to effectively manage our inventory and inventory
reserves;
- impairments of our goodwill or other intangible assets;
- changes in consumer spending patterns and overall levels of
consumer spending;
- our ability to further upgrade our information technology
systems and infrastructure, including our accounting processes and
functions, and other risks associated with the systems that operate
our online retail operations;
- our ability to continue to remedy weaknesses in our internal
controls;
- costs as a result of operating as a public company;
- our assumptions regarding interest rates and inflation;
- changes affecting currency exchange rates;
- continuing business disruptions arising from the on-going war
in Ukraine and in the aftermath of the coronavirus pandemic;
- our financial condition and ability to obtain financing in the
future to implement our business strategy and fund capital
expenditures, acquisitions and other general corporate
activities;
- estimated future capital expenditures needed to preserve our
capital base;
- changes in general economic conditions in the Federal Republic
of Germany (“Germany”), and the European Union and the Unites
States of America, including changes in the unemployment rate, the
level of energy and consumer prices, wage levels, etc.;
- the further development of online sports markets, in particular
the levels of acceptance of internet retailing;
- our behavior on mobile devices and our ability to attract
mobile internet traffic and convert such traffic into purchases of
our goods;
- our ability to offer our customers an inspirational and
attractive online purchasing experience;
- demographic changes, in particular with respect to
Germany;
- changes in our competitive environment and in our competition
level;
- the occurrence of accidents, terrorist attacks, natural
disasters, fires, environmental damage, or systemic delivery
failures;
- our inability to attract and retain qualified personnel,
consultants and collaborators;
- political changes;
- changes in laws and regulations;
- our expectations relating to dividend payments and forecasts of
our ability to make such payments; and
- other factors discussed in “Item 3. Key Information — D. Risk
Factors” in our 20-F filing as of February 7, 2023 and Exhibit 99.4
in our 6-K filing as of June 28, 2023.
Forward-looking statements are subject to known and unknown
risks and uncertainties and are based on potentially inaccurate
assumptions that could cause actual results to differ materially
from those expected or implied by the forward-looking statements.
Actual results could differ materially from those anticipated in
forward-looking statements for many reasons, including the factors
described in “Item 3. Key Information—D. Risk Factors” in our 20-F
filing as of February 7, 2023 and Exhibit 99.4 in our 6-K filing as
of June 28, 2023 and our ability to continue as a going concern.
Accordingly, you should not rely on these forward-looking
statements, which speak only as of the date of this press release.
You should, however, review the factors and risks we describe in
the reports we will file from time to time with the SEC after the
date of this press release.
In addition, statements such as “we believe” and similar
statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us
as of the date of this press release. And while we believe that
information provides a reasonable basis for these statements, that
information may be limited or incomplete. Our statements should not
be read to indicate that we have conducted an exhaustive inquiry
into, or review of, all relevant information. These statements are
inherently uncertain, and you are cautioned not to rely unduly on
these statements.
Although we believe the expectations reflected in the
forward-looking statements were reasonable at the time made, we
cannot guarantee future results, level of activity, performance or
achievements. Moreover, neither we nor any other person assumes
responsibility for the accuracy or completeness of any of these
forward-looking statements. You should carefully consider the
cautionary statements contained or referred to in this section in
connection with the forward-looking statements contained in this
press release and any subsequent written or oral forward-looking
statements that may be issued by us or persons acting on our
behalf.
About SIGNA Sports United:
SIGNA Sports United (SSU) is a NYSE-listed specialist sports
e-commerce company with headquarters in Berlin. It has businesses
operating within bike, tennis, outdoor, and team sports. SSU has
more than 80 online sites and partners with 500 shops serving over
6 million customers worldwide. It includes Tennis-Point, WiggleCRC,
Fahrrad.de, Bikester, Probikeshop, Campz, Addnature, TennisPro and
Outfitter.
Further information: www.signa-sportsunited.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230925460768/en/
SSU Investor & Media Contact Michael Cramer
mc@altcramer.com
SIGNA Sports United NV (NYSE:SSU)
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