Ron Rotter, CEO of the Castro-Hoodis Group said today:
“After a year in which the Castro-Hoodies Group dealt with the Corona Crisis, we conclude the year and the end of the crisis with great success. The streamlining moves made during this period in addition to the group’s planned strategic moves over the past two years. End the period profitably and with high financial strength that allows us to continue with the group’s plans in the coming years.
“Over the past year, the Castro-Hoodies Group has continued its activities for expansion and business development. With the opening of trading on February 21, we launched a new format for the Urbanica chain of stores, which will gradually find expression in a wide range of stores.” The Castro brand CASTRO HOME.
In the Castro fashion brand, we have developed and launched new fashion categories (RELAXED fashion and MOTION sports fashion) with the construction of a new design studio and the appointment of new fashion designers. The iconic sites of the team’s brands (among them: Castro, Hoodies, Carolina Lemke, Urbanica, Kiko Milano, Yves Rocher and Top Ten), recorded a record 26 million entries and crossed the revenue of NIS 150 million, placing the team as one of the major players in the on-sales market. Line (Ikum) in Israel.
To summarize the year, we present strong and leading brands in the categories, solid bases for profitable vegetation, one of the most developed and successful ECOM channels in Israel, a growing and loyal customer club, advanced logistics and computing infrastructure and high financial soundness. “
Report data:
The company’s revenues in the fourth quarter of 2020 amounted to approximately NIS 282 million, compared with revenues of approximately NIS 471 million in the corresponding period last year.
The company’s revenues in 2020 amounted to approximately NIS 1.2 billion, compared with revenues of approximately NIS 1.7 billion in the corresponding period last year.
Sales in the same stores in the group as a whole grew by 12.5% in 2020, in the clothing sector by 15.4%, in the fashion accessories sector by 5.2% and in the cosmetics sector by 35.7%.
Operating profit in 2020 amounted to approximately NIS 68.2 million (5.68%), compared with a loss of approximately NIS 23.5 million in the corresponding period last year.
Operating profit in the fourth quarter of 2020 amounted to approximately NIS 25 million (8.9%) compared with operating profit of approximately NIS 2 million in 2019 (0.4%), an increase of 12.5 times.
The net loss in 2020 amounted to approximately NIS 13 million (1%), compared with a loss of approximately NIS 85 million in the corresponding period last year. Excluding Accounting Standard No. 16, the net profit from continuing operations in 2020 is approximately NIS 5.1 million.
As of December 31, 20, the Company’s cash balances and cash value increased and amounted to approximately NIS 349.4 million.
Notable moves for 2020:
– Castro – a new organizational strategy with the construction of a new fashion design studio, with new fashion designers headed by Noy Dror.
– Improving and streamlining production infrastructure in Asia with the new establishment of all production infrastructure in Asia, while upgrading 60% of suppliers in order to ensure a leap in quality and price
– Organizational and infrastructural merging between the group’s brands in the information systems, logistics, bills and human resources.
– Operational efficiency while reducing operational complexity in order to reach an operating profit rate of 5-10% on a base turnover
Strengthening the financial balance
– Launch of 7 online sites (Ecom) for all the group’s brands, with revenue of 150 sales and more than 26 million hits in 2020
– Launch of a new store design concept – DREAM STORES for the Castro brand, and new concepts for hoodies and top-ten while adjusting the store layout to demand in the new world.
– Development of new product categories in each of the fashion brands. Such as professional sports collections in Hoodies, MOTION collection in Castro, pajama collection in Urbanica and home collection in Urbanica
– Expanding the category of “sustainability” products in the Castro fashion brand – a field that will continue to expand in the future
Business development plans
– CASTRO HOME – Launch of a new homewear brand (textiles and housewares) under the Castro brand, planned for the middle of 2021 with a deployment of 50 stores in the coming years. In order to reach market leadership within 5 years, and present an increase in turnover of NIS 200-300 million.
– Expansion of the “Castro’s children” brand with the expansion of product categories in order to achieve an additional turnover of NIS 100-200 million.
– Urbanica – Launch of a concept of mini-urban stores with a layout of 30 stores, while expanding the stock, sports, lifestyle and toys categories in order to reach an increase in turnover of NIS 150-300 million
– The makeup brand KIKO MILANO Expanding the layout of stores to 30 stores, in order to reach an increase in turnover of about 50-80 million NIS.
– Carolina Lemke Berlin – Launch of innovative technologies for testing vision without human contact, spread over 40 points, in order to reach an increase in turnover of 20-50 million NIS.
– Targeted development for new product categories such as: sports, toys, children and babies, textiles and related products.
– Expansion of the areas of sustainable sustainability products in the Castro brand. Expanding existing collections, streamlining with an emphasis on saving energy and resources, introducing a recycling system downstairs, to Marlog and stores, using recycled materials for packaging and more.
Improving current activity
– Improving operating profitability on a base turnover (2019 – NIS 1.7 billion) to a rate of 5-10%
– Additional operating profit potential in the amount of NIS 150-250 million