OSLO (Reuters) – Norwegian sports retailer XXL warned on Wednesday of weaker earnings margins and said it will raise 500 million Norwegian crowns ($50.6 million) in new equity, and plans to pull out of the Austrian market.
“XXL’s markets have continued to be challenging in the fourth quarter 2022 driven by low consumer confidence and reduced demand for sporting goods in general,” the company said in a statement.
“The market is characterized by high inventory levels in the whole value chain, resulting in aggressive pricing and excessive campaign activities,” it added.
Operating revenue for the fourth quarter is expected to be in the range of 2.3 billion-2.4 billion crowns, “with significantly lower gross margins as a result of the company focusing on liquidity”, XXL said.
The company estimated its earnings before interest, tax, depreciation and amortisation (EBITDA) to amount to between 50 million and 100 million crowns for the October-December period, down from 403 million a year ago.
($1 = 9.8840 Norwegian crowns)
(Reporting by Terje Solsvik, editing by Stine Jacobsen)
