EANS-News: Wolford Aktiengesellschaft / Positive operating earnings in 2015/16 financial year

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annual report/annual result

* Revenues, also boosted by currency items, up 3.2%
* Positive operating earnings (EBIT) and earnings before tax
* Earnings after tax negative due to one-off item
* Dividend of EUR 0.20 per share proposed
* Targets for 2016/17: Slight revenue growth and positive earnings

Vienna/Bregenz, July 15, 2016:Wolford AG, which is listed on the
Vienna Stock Exchange, has presented its results for the 2015/16
financial year (May 2015 to April 2016). The revenues of the Wolford
Group, which also benefited from positive currency items, grew by
3.2% to EUR 162.40 million, while operating earnings (EBIT) came to
EUR 1.55 million, as against EUR 2.17 million in the 2014/15
financial year. However, this figure is not directly comparable with
the previous year, in which EBIT benefited from other operating
income of EUR 12.76 million, and thus more than EUR 10 million higher
than in 2015/16. Despite this factor, the Wolford Group almost
matched the previous year's level of operating earnings. Earnings
before tax were also positive (EUR 0.62 million, as against EUR 1.21
million in the previous year), while earnings after tax were
adversely affected by the reversal of deferred tax assets on loss
carryovers. As a result of this one-off item, the company incurred
non-cash-effective income taxes of EUR 6.81 million (previous year:
EUR 0.18 million) and earnings after tax amounted to EUR -6.19
million, as against EUR 1.03 million one year earlier.

Positive currency items and successful online business

The 3.2% growth in revenues in the past financial year was largely
driven by positive currency items, and particularly by the
development in exchange rates with the US dollar, British pound, and
Swiss franc. Excluding this factor, revenues would have more or less
matched the previous year's figure. After a comparatively strong
revenue performance in the first half of the year, the Christmas
business fell short of expectations. Consistent with developments in
large parts of the European fashion retail sector, revenues then
declined in subsequent months. Overall, fourth-quarter revenues fell
year-on-year by 7%.

The online business once again posted a highly positive full-year
performance (+ 52%). Wolford's proprietary locations (boutiques,
concession shop-in-shops, and factory outlets) increased their
revenues by 2% overall, with like-for-like revenue growth (i.e.
excluding locations newly opened or closed) also amounting to 2%. By
contrast, the wholesale business (partner-operated boutiques,
department stores, and specialist retailers) reported a 2% decline in
revenues.

Marked regional variations in revenue Performance

The company's revenue performance varied widely from region to region
in the 2015/16 financial year. Due to positive currency items,
Wolford posted substantial growth in its core markets of the USA
(+12%), Switzerland (+10%), and the UK (+8%). In Austria (-2%) and in
Germany (-4%), revenues fell short of expectations due to the
heatwave in the late summer of 2015 and disappointing Christmas
business. Revenues in France suffered above all in the wake of the
terrorist attacks in November 2015 and fell by 3%. Thanks to strong
retail business, the Spanish (+12%) and Italian (+8%) markets
reported pleasing growth. Wolford also boosted its revenues in the
Netherlands (+5%), Scandinavia (+3%) and Belgium (+3%). In Asia, the
company even increased its revenues by 16%, with this growth chiefly
being driven by the wholesale business. By contrast, revenues in
Central and Eastern Europe (-4%) were chiefly held back by the
difficult situation on the Russian market.

EBIT and pre-tax earnings positive, dividend payment proposed

The growth in Wolford's proprietary online business and resultant
expansion in stockholdings to ensure product availability led
inventories to increase in the past financial year. This is reflected
in an increase in inventories of finished goods and work in progress,
which rose to EUR 4.40 million (previous year: EUR 1.53 million).
Furthermore, the modernization of the product portfolio and new
go-to-market model led to a changed assessment of the usability of
finished goods, a factor that further increased the value of
inventories. Personnel expenses decreased by EUR 1.62 million to EUR
73.86 million (previous year: EUR 75.48 million), while the average
number of employees (full-time equivalents) fell by three to 1,571.

Given the expansion in the proprietary online business and higher
rental payments in the proprietary retail business, also as a result
of exchange rate movements, other operating expenses rose from EUR
54.97 million to EUR 56.94 million. Thanks to its positive revenue
performance, Wolford nevertheless managed to increase its EBITDA
slightly from EUR 10.94 million to EUR 11.01 million. EBIT came to
EUR 1.55 million, as against EUR 2.17 million in 2014/15, and thus
almost matched the previous year's figure - irrespective of
substantially lower other operating income (EUR 2.30 million, as
against EUR 12.76 million in 2014/15). In the previous year, EBIT
benefited not only from the accounting gain on the sale of the
property not required for operations in Bregenz, but also from the
sale of two lease options (other operating income of EUR 6.36
million) and exchange rate gains of EUR 1.64 million. In the past
2015/16 financial year, Wolford only received EUR 1.12 million from
the sale of non-core rental apartments.

Earnings before tax came to EUR 0.62 million, as against EUR 1.21
million in the previous year. Income tax amounted to EUR -6.81
million (previous year: EUR -0.18 million). Due to a more
conservative interpretation of IAS 12, deferred tax assets of EUR
6.53 million were reversed in the 2015/16 financial year. As a result
of this one-off item, earnings before tax totaled EUR -6.19 million
(previous year: EUR 1.03 million) and thus fell significantly short
of the previous year's figure, as did the earnings per share of EUR
-1.26 (previous year: EUR 0.21).

"Our bottom-line earnings figures were marked by a one-off item due
to the reversal of deferred tax assets. Our operating earnings offer
a far more meaningful indication of the company's performance.
Excluding one-off items in the previous financial year, we boosted
our operating earnings by almost EUR 5 million," comments Axel
Dreher, CFO and COO of Wolford. "We are on the right track with our
operations."

As in the previous year, the Management Board will be proposing a
dividend of EUR 0.20 per share for the past financial year for
approval by the Annual General Meeting.

Balance sheet structure remains solid

The Wolford Group's consolidated equity amounted to EUR 68.15 million
at the balance sheet date on April 30, 2016 and thus fell EUR 6.68
million short of the equivalent figure in the financial statements
for the previous year. This development was due to negative earnings
after tax. The equity ratio amounted to a solid 49% at the balance
sheet date (previous year: 51%). Net debt rose year- on-year by EUR
3.74 million to EUR 20.86 million.

Roadmap developed to enhance profitability

Wolford has set itself the targets of generating sustainably
profitable growth and achieving an EBIT margin of 10 % by the 2019/20
financial year. To meet these objectives, the company is consistently
pressing ahead with implementing the measures already introduced in
2014 to boost revenues (revitalize brand, modernize product
portfolio, refocus market communications, and boost multichannel
distribution). Wolford reached some key milestones in this respect in
the past financial year. One example is the development of a new
store concept that is now due to be made gradually available for
customers to experience on location. It will be unveiled for the
first time from September 2016 at the key locations in Berlin, Los
Angeles (Beverly Hills), and Shanghai. Since 2015, Wolford has also
been implementing a new go-to-market model, one that is exclusively
aligned to end customers' needs and ensures a continuous stream of
new merchandise at the point of sale.

Furthermore, in the past financial year the management examined all
of the company's organizational structures and defined extensive
measures to cut its overall costs. These will be implemented in the
next two financial years, and especially in 2016/17. As a result, in
the current financial year the company will be pressing consistently
ahead with the measures already initiated to optimize its production,
logistics, and supply chain, while also systematically enhancing the
profitability of its proprietary sales areas. The company is
currently also restructuring its sales and marketing organization in
Europe and centralizing all indirect support functions in Bregenz and
Antwerp. This way, it will be building a regional platform strategy
for its global business, with three centers for EMEA, the USA, and
Asia. An effective global corporate marketing organization is also
being created in Bregenz. This will generate substantial
administrative savings over and above the significant efficiency and
effectiveness gains in the company's sales and marketing activities
expected to result from using a new B2B platform for specialist
retailers.

"We made substantial progress in implementing our strategy in the
past financial year. And we still have a way to go in order to
achieve an EBIT margin of 10% by 2019/20," emphasizes Ashish
Sensarma, CEO of Wolford. "And that is why we have developed our
roadmap to profitability, which sets out clearly defined milestones."

Outlook

Wolford AG set itself and also met the target of generating positive
operating earnings (EBIT) in the 2015/16 financial year. The new
2016/17 financial year began on a subdued note, with revenues
throughout the European fashion retail sector performing weakly in
the months of May and June.

Wolford nevertheless expects to generate slight revenue growth in the
financial year as a whole. Despite foreseeable expenses of around EUR
1.1 million expected for the implementation of new structures,
operating earnings are also expected to rise slightly. No further
items should result from the reversal of deferred taxes on loss
carryovers, as a result of which earnings after tax are also expected
to be positive.

The 2015/16 Annual Report and the 2015/16 Annual Financial Report can
be viewed and downloaded in the Investor Relations section of the
company's website at: company.wolford.com.

http://company.wolford.com/wp-content/uploads/2016/07/Wolford_Annual_
Report_2015_16.pdf http://company.wolford.com/wp-content/uploads/2016
/07/Wolford_Annual_Financial_Report_2015_16.pdf

Earnings Data

______________________________________________________________
|______________________|____________|2015/16|2014/15|Change (%)|
|Revenues______________|in_EUR_mill.|162.40_|157.35_|+3________|
|EBIT__________________|in_EUR_mill.|1.55___|2.17___|-29_______|
|Earnings_before_tax___|in_EUR_mill.|0.62___|1.21___|-49_______|
|Earnings_after_tax____|in_EUR_mill.|-6.19__|1.03___|>100______|
|Investments___________|in_EUR_mill.|7.30___|10.97__|-34_______|
|Free_cash_flow________|in_EUR_mill.|-2.35__|-0.54__|>100______|
|Employees_(on_average)|FTE_________|1,571__|1,574__|-1________|

Balance Sheet Data
_________________________________________________________________________
|___________________|____________|April_30,2016|April_30,2015|Change (%)|
|Equity_____________|in_EUR_mill.|68.15_________|74.83_________|-9________|
|Net_debt___________|in_EUR_mill.|20.86_________|17.12_________|+22_______|
|Working_capital____|in_EUR_mill.|43.15_________|38.14_________|+13_______|
|Balance_sheet_total|in_EUR_mill.|139.25________|147.44________|-6________|
|Equity_ratio_______|in_%________|49____________|51____________|-_________|
|Gearing____________|in_%________|31____________|23____________|-_________|

Stock Exchange Data

________________________________________________________________________
|________________________________|____________|2015/16|2014/15|Change (%)|
|Earnings_per_share______________|in_EUR______|-1.26__|0.21___|>100______|
|Share_price_high________________|in_EUR______|25.48__|24.12__|+6________|
|Share_price_low_________________|in_EUR______|21.35__|18.75__|+14_______|
|Share_price_at_the_end_of_period|in_EUR______|24.67__|24.00__|+3________|
|Shares_outstanding_(weighted)___|In_1,000____|4,912__|4,900__|+1________|
|Market_capitalization_(ultimo)__|in_EUR_mill.|123.35_|120.00_|+3________|

About Wolford AG
Wolford AG, which has its headquarters in Bregenz on Lake Constance (Austria),
has 16 subsidiaries and markets its products in more than 60 countries via 262
mono-brand points of sales (company-owned and partner-operated), around 3,000
distribution partners, and online. Listed on the Vienna Stock Exchange since
1995, in the 2015/16 financial year (May 1, 2015 - April 30, 2016) the company
had around 1,570 employees and generated revenues of EUR 162.4 million. Founded

in 1950, Wolford has since grown to become the leading global brand
for luxurious legwear, exclusive lingerie, and high-quality bodywear.

Further inquiry note:
Wolford AG
Maresa Hoffmann
Referentin Investor Relations & Corporate Communications
Tel.: +43 5574 690 1258
investor@wolford.com | company.wolford.com

end of announcement euro adhoc
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company: Wolford Aktiengesellschaft
Wolfordstrasse 1
A-6900 Bregenz
phone: +43 (0) 5574 690-1268
FAX: +43 (0) 5574 690-1219
mail: investor@wolford.com
WWW: company.wolford.com
sector: Textiles & Clothing
ISIN: AT0000834007
indexes: ATX Prime, ATX Global Players
stockmarkets: free trade: Frankfurt, regulated dealing: Wien, ADR: New York
language: English