- Under the Leadership of CEO Olivier Van den Bossche,
GALERIA Kaufhof Group to Benefit from HBC’s Relationships with the World’s Best Brands, Successful Strategies in Key Merchandise Categories and Expertise in All-Channel Retailing
- New Strategies Build from GALERIA Kaufhof Group’s Strong Heritage and Great Loyalty in the German and Belgian Markets; will be introduced as soon as the First Half of 2016
COLOGNE, Germany & TORONTO, 2015-10-1 — /EPR Retail News/ — GALERIA Kaufhof Group (“the Company”) today announced the closing of its successful acquisition by Hudson’s Bay Company (“HBC”) (TSX:HBC) and provided an overview of the plans in place to build on its strong heritage and important role in the German and Belgian retail marketplace. The plans center on working with HBC to invest in the GALERIA Kaufhof Group banners being GALERIA Kaufhof, Galeria INNO, along with DINEA and Sportarena to substantially enhance the customer experience across all channels and drive growth now and into the future.
“On behalf of everyone at HBC, I want to welcome GALERIA Kaufhof Group, all banners and all 21,500 Associates, to our family of exceptional department stores,” said Richard Baker, Governor and Executive Chairman of HBC. “Our experience since we began working with Olivier Van den Bossche and the leadership team has reaffirmed for us thatGALERIA Kaufhof Group has a strong platform in place, highly motivated Associates, great loyalty among customers, outstanding locations and substantial potential for growth.”
Jerry Storch, HBC’s CEO, said, “Our teams are off to a strong start working together in developing plans that build fromGALERIA Kaufhof Group’s distinctive appeal in the German market while bringing to bear the strategies that have enabled us to drive substantial growth at our department store banners in North America, including Saks Fifth Avenue, Saks OFF 5TH, Lord & Taylor and Hudson’s Bay. We strongly believe in the great future ahead for GALERIA Kaufhof Group and look forward to seeing our plans come alive across all channels.”
With the addition of GALERIA Kaufhof Group, the HBC portfolio includes more than 464 stores in four countries with eight banners and expected sales in the range of C$14.5-C$15.5 billion in fiscal 20161.
New Strategies to Dramatically Enhance the Customer Experience
Beginning in the first half of 2016 and through 2017, GALERIA Kaufhof Group plans to introduce the following strategies in Germany and Belgium, with additional plans to be announced over time:
- Leveraging HBC’s global footprint and deep brand relationships, GALERIA Kaufhof Group expects to attract a wider range of world-class brands, including in important women’s categories. The Company expects to accelerate its introduction of new brands that are highly sought after by German and Belgian customers.
- Substantially enhancing GALERIA Kaufhof Group’s beauty, shoes and handbag offerings to differentiate them across the German marketplace and make them premier destinations for customers. Each of these departments will be substantially enlarged with new designs, brands and enhanced service.
- Expanding GALERIA Kaufhof Group’s digital capabilities and offerings in order to develop Germany’s best consumer-facing network, incorporating stores, the internet, mobile and social media, building on the successful digital merchandising and marketing strategies HBC has employed in North America. In connection with this, GALERIA Kaufhof Group will invest in assortment expansions as well as fulfillment capabilities to increase efficiency and ease of ordering and delivery.
- Expanding the offering for customers by growing store selling space, by making use of previously unproductive office and storage areas.
Additionally, HBC plans to introduce its Saks Fifth Avenue and Saks OFF 5TH banners to the German market over time.
Putting Plans Into Action
Don Watros, President of HBC International, will work closely with Olivier Van den Bossche and the GALERIA Kaufhof Group team to oversee and support execution of the plans for the business going forward.
“Olivier has a true passion for retail and is a renowned expert in the strategic development of department stores,” saidMr. Watros. “I look forward to collaborating with him and his first-rate team, combining the experience and philosophy of HBC with the expertise and continuity guaranteed by the existing management team at GALERIA Kaufhof Group. We are thrilled to start putting our plans into action and making the banners even better places to visit, shop and work.”
HBC plans to honor all commitments it has made under GALERIA Kaufhof Group’s Social Charter and expects to expand the Associate base over time as new strategies create demand for personnel in stores and in connection with digital strategies. The Company will remain headquartered in Cologne, Germany.
Olivier Van den Bossche, CEO of GALERIA Kaufhof Group, said, “HBC strongly believes in the future of department stores and has a proven track record of driving strong performance at well-known retail banners by enhancing the customer experience through all channels. Our team is enormously excited about the plans we have developed to start a new chapter for GALERIA Kaufhof Group and to drive the growth and success of our business.”
Looking to the Christmas Season and the Future
Mr. Van den Bossche added, “Even as we look to the future, we are focused on delivering an enjoyable, exciting and convenient Christmas shopping experience for our customers, including greater investment in marketing to highlight our offering and service in our stores and online fulfillment. And we look forward with great anticipation to bringing our new plans to life for our customers starting in the new year.”
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About GALERIA Kaufhof Group
GALERIA Kaufhof Group, with its headquarters in Cologne, Germany, is a leading European department store company. With its innovative and successful Galeria concept, the Company offers a modern shopping experience.GALERIA Kaufhof Group, with 21,500 employees, currently operates 102 GALERIA Kaufhof department stores, 60 DINEA restaurants, and 16 Sportarena stores in Germany as well as 16 Galeria INNO department stores in Belgium. Since October 1, 2015, GALERIA Kaufhof Group is part of the premier global department store retailer Hudson’s Bay Company (TSX: HBC). More Information is available under: galeria-kaufhof.de.
About Hudson’s Bay Company
Hudson’s Bay Company (TSX: HBC) is one of the fastest-growing department store retailers in the world, based on its successful formula of driving the performance of high quality stores and their all-channel offerings, unlocking the value of real estate holdings and growing through acquisitions. Founded in 1670, HBC is the oldest company in North America. With the recent completion of its acquisition of GALERIA Kaufhof Group, HBC’s portfolio today includes eight banners, in formats ranging from luxury to better department stores to off price, with more than 460 stores and 65,000 employees around the world.
In North America, HBC’s leading banners include Hudson’s Bay, Lord & Taylor, Saks Fifth Avenue and Saks OFF 5TH, along with Home Outfitters. In Europe, its banners include GALERIA Kaufhof, the largest department store group inGermany, Belgium’s only department store group Galeria INNO, as well as Sportarena.
HBC has significant investments in real estate joint ventures. It has partnered with Simon Property Group Inc. in HBS Global Properties Joint Venture, which owns properties in the United States and Germany. In Canada, it has partnered with RioCan Real Estate Investment Trust in the RioCan-HBC Joint Venture.
Forward-Looking Statements – Hudson’s Bay Company
Certain statements made in this news release, including, but not limited to, the benefits that are expected to result from the acquisition of GALERIA, growth strategies and opportunities for GALERIA as a result of contemplated strategic initiatives, HBC’s prospect for future European growth opportunities, and earnings guidance in respect of Sales for fiscal 2016, and other statements that are not historical facts, are forward-looking. Often but not always, forward-looking statements can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “believe”, “estimate”, “plan”, “could”, “should”, “would”, “outlook”, “forecast”, “anticipate”, “foresee”, “continue” or the negative of these terms or variations of them or similar terminology.
Implicit in forward-looking statements in respect of Sales for fiscal 2016, are certain current assumptions, including, among others, HBC achieving low single digit same store sales growth on a constant currency basis in fiscal 2016, HBC opening new stores and assumptions regarding currency exchange rates for fiscal 2016. Specifically, we have assumed the following exchange rates for fiscal 2016: € 1 = C$1.50; US$1 = C$1.32. These current assumptions, although considered reasonable by HBC at the time of preparation, may prove to be incorrect. Readers are cautioned that actual future operating results and economic performance of HBC, including with respect to our anticipated Sales for fiscal 2016, are subject to a number of risks and uncertainties, including, among other things described below, general economic, market and business conditions, changes in foreign currency rates from those assumed, the risk that HBC may not achieve same store sales growth on a constant currency basis, and could differ materially from what is currently expected as set out above.
Although HBC believes that the forward-looking statements in this news release are based on information and assumptions that are current, reasonable and complete, these statements are by their nature subject to a number of factors that could cause actual results to differ materially from management’s expectations and plans as set forth in such forward-looking statements for a variety of reasons. Some of the factors – many of which are beyond HBC’s control and the effects of which can be difficult to predict – include, among others: (a) the risk that the anticipated benefits and growth opportunities from the GALERIA acquisition cannot be realized; (b) the ability of HBC to retain and attract key GALERIA personnel and for GALERIA to maintain relationships with customers, suppliers and other business partners; (c) credit, market, currency, operational, liquidity and funding risks generally, including changes in economic conditions, interest rates or tax rates; and (d) risks and uncertainties relating to information management, technology, supply chain, product safety, changes in law, competition, seasonality, commodity price and business.
HBC cautions that the foregoing list of important factors and assumptions is not exhaustive and other factors could also adversely affect its results. For more information on the risks, uncertainties and assumptions that could cause HBC’s actual results to differ from current expectations, please refer to the “Risk Factors” section of HBC’s Annual Information Form dated April 30, 2015, HBC’s second quarter Management Discussion & Analysis dated September 10, 2015, as well as HBC’s other public filings, available at www.sedar.com and at www.hbc.com.
The forward-looking statements contained in this news release describe HBC’s expectations at the date of this news release and, accordingly, are subject to change after such date. Except as may be required by applicable Canadian securities laws, HBC does not undertake any obligation to update or revise any forward-looking statements contained in this news release, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements.
1 See Forward Looking Statements for additional information.
FOR GALERIA KAUFHOF GROUP
Gerd Koslowski, +49 (0)221 223-5595
Head of Corporate Communications
Tiffany Bourré, (905) 595-7184
Director, External Communications
Dirk von Manikowsky, +49 (0)211 43079-265
INVESTOR RELATIONS:, (416) 256-6745
Source: Hudson’s Bay Company
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