Tendam, a group that owns brands such as Pedro del Hierro, Sprinfield or Women’Secret, among many others, is ready to go public, but will not do so until market conditions are optimal and the ecosystem is not flooded with uncertainty, with the escalation of geopolitical conflicts, interest rates still high and the presidential elections in the United States unresolved. This is explained by Jaume Miquel, president of Tendam, at the IV Retail and Mass Consumption Forum held by elEconomista.es, where he also announces that, among the company’s plans, there are acquisition operations.
Tendam planned to make the jump to the stock market this summer, but finally postponed his departure due to the great volatility that existed then in the market with the European elections. Although everything indicated that it would be in the first half of 2025 when the company finally took the step of starting its stock market debut, the group manager confirms that the operation will not be carried out until conditions are favorable.
“We said that we would exit when there were market conditions to exit and when we were prepared. And before the summer, that was not the case. We have seen that the market continues to have a lot of uncertainty, although the stock market, on the other hand, is doing well. For the new companies, there is a lot of uncertainty, with rates that have not yet fallen enough and with a debt market that remains attractive. American capital is more reluctant to invest, plus the geopolitical situation and the elections in the United States,” he argues.
Although the first leg is not met (a favorable market situation), the second is ready, with a company “prepared to go public, and when sufficient conditions are met in the market, we will go public,” says Miquel. The president of Tendam clarifies at this point that the company has not been managed to go public, but “to grow”, so Tendam “will continue to grow whether there is a liquidity event with the IPO or not.”
“Going public is because it is the natural space for a company that grows between 6-8% annually, that has a very low level of leverage and can offer a reasonable level of deleveraging and dividend. For the company it is beneficial, because It has preferential access to the capital market and makes it easier for you to carry out acquisition operations,” completes Miquel. At this point, Miquel assures that Tendam will be a company “balanced between growth and dividend”, since will offer an “interesting” dividend that is between 3.5% and 5%.
And the figures speak for themselves. At Tendam they have had fourteen consecutive quarters of growth. Last year, revenue increased by 9.8%, up to 1,288 million, which was a historic figure. Leverage has been reduced to 1.5 times (from the 8 times the company was at seven years ago) and, in the first semester results, they reported a growth of 7.3%, with an improvement in margin and ebitda. This year, since the signing They expect to close with a growth range between 6-8% and protection in the income statement.
Tendam’s gross margin reached 62.5% in 2023a figure that easily exceeds that of the rest of the competitors in the retail segment. The key to achieving this is “knowing the client well”, according to Miquel. “If you know the client, it means that you produce less and have less leftovers. This makes you have a better margin. This is key number one. If you have fairly rigid and stable processes in quality, patterning, finishing, fabrics, etc., you have less returns, and that also helps. There is no secret formula, it is knowing the customer and trying to make a good product,” he develops.
Next challenges
Growth is the main objective of the company, which is currently in 80 countries and looks at Mexico as a “very interesting” destination. “We want to be in large countries, where the consumer mass is above 20,000 euros per capita, where we can have digital business, we are 100% omnichannel, we have our own brands and those of third parties…”, are some of the conditions they seek in their expansion process in different countries. In Spain they have already achieved it, in Portugal they have little left, in the Balkans they are just starting and in Mexico they are at 30%.
The group, which has 12 own brands and 160 third-party brands, is currently present throughout Latin America, except Argentina and Brazil. As for China, which is currently not going through its best moment, he believes that the opportunity continues to be for luxury firms and for the Chinese brands themselves, since “they know the customer better and will know how to better adapt the model morphologically”, which advantage in price and costs.
European sustainability regulations are another of the segment’s challenges. retail in general. Tendam is a founding member of SCRAP, which promotes the reuse and recycling of waste. “The clear objective is to organize all the surpluses and make an orderly waste recycling process, and this is positive. And the objective is for the rest of the sector to join in. The concept of sustainability is a concept that has many angles, and there is also a geopolitical angle. Europe regulates, and it is good that it regulates, but it does so with complexity,” says the president.
Miquel assures that the problem is not a regulatory framework that can be challenging for companies to achieve, since they are well prepared for it. The problem lies in “a complexity of different non-harmonized regulatory frameworks”, since Europe is not in a favorable competitive situation compared to Asia or the United States.
Among the measures that are being carried out in the sector to reduce the carbon footprint is limiting returns. The online returns rate at Tendam is 28%, which is well below that of the sector, which is 35-40%. “We have a low rate because 75% of business are members of loyalty clubs and, therefore, know their size. The gap between the photo on the website and what you receive is small. And third, because we are not in fast fashion, our fashion is more predictable. We have garments with a long life expectancy of usability and fashion, and this makes returns less,” explains the manager.
#Tendam #leaves #IPO #air #plans #acquisitions
