DGAP-News: Adler Modemärkte AG: ADLER Receives €69 Million in Long-term Financing Commitments

Press Release from Adler Modemärkte AG

Securing Operations and Increased Strategic Development

ADLER Receives €69 Million in Long-term Financing Commitments
Focus on Securing Liquidity, Cost-efficiency and Resuming In-store Sales

Haibach (near Aschaffenburg), 12 May 2020: Adler Modemärkte AG is driving forward the strategic development of the company in order to emerge from the current Covid 19 crisis stronger than before. In this context, ADLER has secured additional financial leeway to stabilise business operations and to provide additional financing for ADLER Group with financing commitments of €69 million. The underlying syndicated loan has been granted on the basis of a joint guarantee by the state governments of Bavaria and North Rhine-Westphalia, to be disbursed to Adler Modemärkte AG by its core lenders at standard market terms for a term of six years. As a result of the guarantee commitment available as of today, the loan agreement already concluded as part of interim financing can now be fully utilised.

Financing should help to emerge stronger from the crisis
It has become necessary for ADLER to raise additional funds, because the closure of all of its 171 stores in Germany, Austria, Luxembourg and Switzerland on official orders aimed at containing the continuing spread of COVID-19 has resulted in significant losses of revenue.

Building on its unique positioning as the market leader in the target group of affluent customers aged 55 and over, ADLER will use the extensive financial resources to initiate additional strategic measures to return to its targeted profitable growth path as quickly as possible. In this context, the management team has already begun to draw up initial conceptual approaches to realign all structures and processes above and beyond ADLER's "Strategy 2023" initiative and across every link in the value chain so that it is prepared for the post-crisis era. ADLER believes that there is significant additional potential, e.g., through the continued optimisation of working capital management, a reduction of risks within the business model, continuing efforts to optimise stores and expanding online activities even further than previously.

In financial year 2019, ADLER reported net liquidity of €70.1 million with €57.4 million in free cash flow - demonstrating the financial soundness of its business model despite the difficult conditions in the textile retail industry

"ADLER has successfully secured its operations for the long term by obtaining financing commitments of €69 million. The significant financial strength of our business model, which we have demonstrated in previous years, and our long-established, solid relationships with our primary banks have formed the basis for this success. By taking this step, we are preparing ourselves financially for the impact of the COVID-19 pandemic, and we are confident that we will emerge from this difficult time even stronger," said Thomas Freude, CEO of Adler Modemärkte AG.

Focus on securing liquidity and cost-efficiency - sales in stores ramping up again
The Company's Executive Board is continuing to closely monitor the situation and events as they develop, as well as the unprecedented impact of the COVID-19 pandemic. It has already taken a number of steps to assist customers, employees and other stakeholders, as well as to secure operations. These include the introduction of short-time work in Germany, Austria, Luxembourg and Switzerland. In addition, a large number of temporarily shuttered stores have been open again since 20 April 2020.

As of today, apart from 10 locations in Bremen, Hamburg and Saxony - where sales are still restricted to 800 square metres - all of the Company's 142 stores in Germany have reopened with entire floor space, which averages well over 1,500 square metres. The health and safety of employees and customers remains a top priority in this exceptional situation. The Company's 29 stores outside of Germany also reopened in Austria (24), Luxembourg (3) and Switzerland (2).

Still no reliable forecast possible for 2020
The further development of the COVID-19 pandemic and its effects on ADLER Group's business cannot yet be reliably predicted at this time. ADLER is therefore still unable to make a forecast which includes these effects for the full year 2020. As soon as the uncertainties subside, the Executive Board intends to publish a new forecast for the current financial year.

For more information about the Company, please visit ADLER's website at https://www.adlermode-unternehmen.com/en/.

Adler Modemärkte AG press enquiries and investor relations:
Peter Dietz
Media and Investor Relations
Tel.: +49 6021 633 1828
E-mail: [email protected]

About Adler Modemärkte AG:
Adler Modemärkte AG, headquartered in Haibach near Aschaffenburg, Germany, is one of Germany's largest and most important textile retailers. In 2019, the Group generated revenue of €495.4 million and EBITDA of €70.3 million. As at 31 December 2019, ADLER employed a workforce of around 3,600 and currently operates 171 stores, 142 of which are located in Germany, 24 in Austria, three in Luxembourg, two in Switzerland, plus an online shop. The Company focuses on large-space concepts offering in excess of 1,400 m² of retail space. With its many own brands and select external brands, ADLER offers a highly diverse product range. Thanks to more than 70 years of tradition and strong customer loyalty, ADLER considers itself to be the market leader within its target group of affluent customers aged 55 and over.
For more information: www.adlermode-unternehmen.com; www.adlermode.com