Despite entering November with an ominous announcement regarding European store closures, Lovisa Holdings is currently trading 37% higher against last month. On November 2, the fashion jewellery and accessory retailer announced that as a result of the UK and French governments implementing further lockdowns in response to the increasing COVID-19 cases in both countries, its European stores would be subject to temporary closures.
However, two weeks later, Lovisa announced the acquisition of the European retail store network of German wholesaler ‘beeline GmbH’. The purchase is expected to add more than 80 stores to the Lovisa global store network across 6 European countries. The beeline retail business currently sells fashion jewellery and accessories under the SIX and I AM brands. Lovisa will acquire the shares of the six retail trading entities of the beeline Group in Germany, Switzerland, The Netherlands, Belgium, Austria and Luxembourg, with all continuing stores to be rebranded to trade as Lovisa stores.
Managing Director Shane Fallscheer said, “We are very excited that this transaction gives us the opportunity to add six new countries to our global store network, and provides us with a strong base and quality team to grow the Lovisa brand further in these markets into the future as part of our ongoing global rollout strategy.”
In a concurrent trading update, the company advised that despite the European store closures, the remainder of the store network has seen improving sales trends. Comparable sales in FY21 are only marginally down as a result of strong performance from markets that have been re-opened the longest and with the least restrictions in place, with Australia and New Zealand continuing to be the best performing regions.
The news has boosted Lovisa’s share price back to almost pre-COVID levels, taking its market cap to $1.2B.
Lovisa is a fast-fashion jewellery retailer in a number of international markets. It has a total of 390 stores, across Australia, New Zealand, Singapore, Malaysia, South Africa, UK, USA, and France, along with franchise-owned stores in Asia and the Middle East.