Mavi Giyim Sanayi ve Ticaret (MAVI) Q1 2025 earnings summary

Executive summary

• Consolidated sales reached TRY 8.273 billion in Q1 2024, up 20% year-on-year, with 89% of revenue from Turkey and retail and online sales growing 26% and 23%, respectively.

• EBITDA grew 49% to TRY 1.984 billion, with a margin of 24%, and net income surged 127% to TRY 969 million.

• Strong customer acquisition continued, with 409,000 new customers in Q1 and active loyalty program members reaching 5.7 million.

• International revenue declined 5% in constant currency, mainly due to macro headwinds and wholesale exits in Canada.

• Continued investment in brand, customer experience, omni-channel, CRM, and digital transformation supported performance.

Financial highlights

• Gross margin improved to 52.5%, up 650 basis points year-on-year, aided by efficient sourcing and minimal markdowns.

• Operating profit nearly doubled to TRY 1.66 billion, with operating margin rising to 20.1%.

• Operational cash generation exceeded TRY 2 billion, with a 105% cash conversion rate and net cash position of TRY 5.27 billion by April end.

• CapEx in Q1 was TRY 220 million, mainly for store expansion and digital investments, with a CapEx to sales ratio of 2.7%.

• Cash and cash equivalents at period end totaled TRY 6.45 billion.

Outlook and guidance

• FY2024 guidance unchanged: consolidated sales growth of 70% ±5% (excluding IAS 29), EBITDA margin of 20% ±0.5% exc. IFRS16, and 23.5% ±0.5% inc. IFRS16.

• Net 15 new store openings and 10 expansions planned in Turkey retail, with CapEx to sales ratio expected at 5% including new headquarters investment.

• Early Q2 shows continued positive sales momentum, with May retail and online sales up 74% and 73%, and Eid holiday in June driving further growth.

• Management expects some normalization in growth rates but remains confident in exceeding 15-20% volume growth.

• Net cash position anticipated to increase.