Last year, Hema suffered a loss of 214.8 million euros, while turnover also decreased. The main villain: the coronavirus. However, the takeover saga also proved to be an issue. A new management team is now ready to take the lead.
Recapitalisation and Covid costs
Department store chain Hema had a particularly turbulent 2020. Not only did the company have to deal with the Covid crisis, but 2020 was also the year in which owner Marcel Boekhoorn was dismissed by the creditors and a difficult takeover battle broke out regarding the Dutch icon. Eventually, the chain came into the hands of investor group Parcom and family Van Eerd, the owners of Jumbo, but that rescue came at a cost.
After debt restructuring, the bond debt was halved to 300 million euros. The annual interest charges were also reduced by 80 per cent to around 10 million euros a year. The new owners have since reduced the debt even further to 200 million euros. Those recapitalisation and financing costs, and of course the Covid pandemic, did cause Hema to end last year with a net loss of 214.8 million euros. Without one-off write-downs, the bottom line was still 149.6 million euros below zero.
Turnover also fell last year by 15.5 per cent, for which the coronavirus is entirely to blame. Still, e-commerce sales doubled, thanks to a “multichannel strategy, a substantial expansion of logistics capacity and the use of stores as local warehouses according to the ship-from-store model,” said the company. Meanwhile, Hema’s partnership model expanded, with items from the chain now available at 662 Jumbo, Franprix and Géant/Casino (in France) supermarkets.
A fresh start for Hema
After what Hema itself calls “one of the most challenging years ever”, a new management team has been in place since 1 June. Brand new top woman Saskia Egas Reparaz – the replacement for long-time CEO Tjeerd Jegen – will be assisted by a team of six. They include Wilma Veldman (Chief Product Officer), Bas Verheijen (Chief Customer Officer), Machiel Lagerweij (Chief Operating Officer) and Pieter Heij (Chief Technology Officer) as newcomers, although, Veldman and Lagerweij also worked for Hema in the past. Nadine Beister and Joost de Beijer will continue in their former roles of Chief People Officer and Chief Financial Officer.
Hema is leaving “the financial challenges of recent years behind it once and for all”, it is said, and this can already be seen in the early results since the reopening of the stores in the Netherlands on 28 April. The footfall is still limited, but the figures would already be better than those of the same period in the pre-Covid year 2019.