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Original-Research: Global Fashion Group S.A. - from NuWays AG

27.08.2025 / 09:00 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQ

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The issuer is solely responsible for the content of this research. The

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Classification of NuWays AG to Global Fashion Group S.A.

Company Name: Global Fashion Group S.A.

ISIN: LU2010095458

Reason for the research: Update

Recommendation: Buy

from: 27.08.2025

Target price: EUR 0.80

Target price on sight of: 12 month

Last rating change:

Analyst: Henry Wendisch

GFG released Q2 results that were overall marked by further improvements in

top line and margins. In detail: Q2 NMV came in flat yoy at EUR 249m in

constant currency (-8% yoy after FX), highlighting the stabilization of

demand across all regions. Particularly strong recovery was seen in LATAM

(+10.2% yoy before FX) and ANZ (+5.8% yoy before FX) and could offset the

ongoing decline in SEA (-22.5% yoy before FX), which still remain

challenging for now. The stabilisation was the direct effect of (1) a stable

user base (LTM active customers declined by only 2.5% yoy), particularly in

ANZ and LATAM, where new & reactivated customers outpaced churn, coupled

with (2) a stable average order value of EUR 61.40 (+2% yoy, -6% yoy after

FX).

Accordingly, Q2 sales declined slightly by 1.2% yoy (-8.4% after FX) to EUR

163m. Notably, the trend shift towards Marketplace and Platform services and

away from Retail business model continued, with sales from Marketplace and

Platform Services growing by 4% and Retail sales declining by 7% yoy in H1.

This shift coupled with a 1.8pp higher gross margin on retail sales (eNuW)

on the back of less aged inventory, has continued to positively affect the

group's gross margin by 2.9pp yoy to 47.7% in Q2. Further overhead

reductions and a more cost efficient fulfilment (expense per order: -7%

yoy), led to an overall adj. EBITDA margin improvement by 3.9pp yoy and a EUR

3m adj. EBITDA in Q2 (vs. EUR -3.7m in Q2'24).

Consequently, GFG reiterated its FY'25e guidance of adj. EBITDA break even

(eNuW: EUR 1.7m) and NMV ranging from EUR 1-1.1bn (eNuW: EUR 1.06bn). With that,

GFG is also improving the cash generation picture. Although normalized FCF

came in slightly worse than last year at EUR -62m per H1 (vs. -EUR 57m in H1'24)

and at only EUR -1.4m in Q2 (EUR -1m in Q2'24), due to unfavorable WC swing

(specifically trade payables) in H1, the cash generation should neverthele

improve overall in FY'25e. With operating cashflow to improve from EUR -36

last year to EUR -10m in FY'25e (eNuW) on the back of the visible

profitability gains and with less CAPEX (EUR 3m in Q2 vs. EUR 9m in Q2'24)

expected throughout the year, we expect a drastically improved FY'25e FCF of

EUR -25m (vs. EUR -42m in FY'24).

With a solid pro-forma net cash position of EUR 97.2m, GFG has enough leeway

to continue to drive the ongoing developments and restructurings. Especially

the SEA turnaround (with a new CEO in place and other strategic measures in

the pipeline), which could play a vital role in achieving a positive FCF

over the next years, but this also depends on macro-economic developments.

Against this backdrop, GFG remains undervalued. Especially with positive

FCFs visible on the horizon while simultaneously trading at a negative EV,

current valuation seems unjustified in our view. Therefore, we reiterate our

BUY recommendation with an unchanged PT of EUR 0.80, based on DCF.

You can download the research here:

https://eqs-cockpit.com/c/fncls.ssp?u=79b5fcb4603d279de3cc296de24c2ef9

For additional information visit our website:

https://www.nuways-ag.com/research-feed

Contact for questions:

NuWays AG - Equity Research

Web: www.nuways-ag.com

Email: research@nuways-ag.com

LinkedIn: https://www.linkedin.com/company/nuwaysag

Adresse: Mittelweg 16-17, 20148 Hamburg, Germany

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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschlu

bestimmter Börsengeschäfte.

Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben

analysierten Unternehmen befinden sich in der vollständigen Analyse.

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2189090 27.08.2025 CET/CEST

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