Answear.com is not slowing down in a difficult market, The company reported a 29% increase in revenue in 2023.

Answear.com, a leading e-commerce provider of fashion, sports/outdoor, and home & lifestyle products in the CEE region, concludes 2023. Despite a challenging market environment and a period of investment in PRM brand development, Answear.com has reported robust revenue growth and maintained solid profitability. The company remains one of Europe's fastest-growing e-commerce platforms in the fashion industry, successfully executing its strategic objectives and continuing to build its leadership position in the CEE region. 

- The past year was a challenging period due to the challenging macroeconomic and geopolitical situation. In the recent period we also had to face many other adversities, which we coped with very well, as evidenced by the growth of our business by more than 29 percent year-on-year, which puts us among the fastest growing fashion e-commerce in Europe leaving far behind the competition," comments Krzysztof Bajołek, CEO of Answear.com. 

Answear.com faced weakening consumer demand, low retail sales figures, appreciation of the zloty, increased price competition and implementation of the omnibus directive in the past year. In addition, sales, at the end of the year, were negatively affected by the unstable geopolitical situation, including, among other things, the blockade of carriers on the Polish-Ukrainian border in Q4 2023, which resulted in longer delivery times and a lower propensity for customers to order from Ukraine and thus reduced sales.   

- In 2023, we made a significant investment by acquiring the two brands PRM and Sneakerstudio. It was a strategic decision for us, enabling us to enter a brand new, prospective and dynamically growing luxury-streetwear segment, and to reach a new group of consumers using numerous operational synergies between Answear.com and the newly acquired brands. It is worth emphasizing that the transaction took place non-cash and at an attractive value, however, the acquired assets require further investment in development, time and effort before they begin to pay off," adds Krzysztof Bajołek. 

In the past year, Answear.com reported revenue growth of 29 percent y-o-y. to PLN 1.26 billion, gross margin increased by 28 percent y-o-y. to PLN 500 million. On the other hand, the Company's profitability was burdened by costs related to the development and integration of acquired brands under a single PRM brand. As a result, EBITDA amounted to PLN 57 million, down 8.5 percent year-on-year. It is worth mentioning that at the EBITDA level, the PRM brand achieved a negative result of -11.5 million PLN, Answear.com's EBITDA excluding the PRM brand increased by 10 percent y-o-y. to PLN 68 million. This demonstrates the good condition of Answear.com's own business despite challenging market conditions. 

- Let's treat 2023 as an investment in the PRM brand. Which, of course, involved incurring costs and putting a strain on our bottom line. However, we expect significant benefits in future periods, due to the premium segment with high margins and transaction profitability. The first effects of our actions are already visible, PRM sales in Q4 2024 increased 2-fold quarter-on-quarter and amounted to PLN 24 million," added Jacek Dziaduś, Answear.com's vice president of finance. 

In the last months of 2023, Answear.com undertook a series of activities to develop the PRM brand. As part of this, the Company successfully launched 12 new online stores in all markets where it operates. In addition, since June, PRM has added 38 new brands to its offerings, and the process of acquiring more is still underway. This rapid expansion of the offer contributes to the so-called "snowball effect," where the appeal of some brands effectively attracts others. In addition, advanced work is underway to launch a flagship concept store in the Norblin Factory in Warsaw, as well as to conduct an extensive image campaign. 

In 2023. Answear.com continued its strategy of improving its offerings and increasing the share of premium brands in its sales, which accounted for 69 percent of all brands on offer at the end of the year, up from the 63 percent recorded a year earlier, contributing to a further increase in the value of the average shopping cart and expected to have a positive impact on the company's profitability in the future.