Bimba y Lola Faces Profit Plunge: Sales Stagnation Leads to Tenfold Decline Over Three Years

Bimba y Lola drastically cuts its profit. The Spanish company, which has just incorporated Carlos Soler-Duffo (former CEO of Tous) to its board of directors, earns ten times less in the last four years, reducing its net result to only €1.5 million. In the midst of a repositioning phase, the company’s sales have stagnated.

According to information published by the company itself, Bimba y Lola ended the 2024 fiscal year (ended last February) reducing its net income by more than 75%. The company closed the 2020 financial year (marked by the Covid-19 crisis) with losses of five million euros. A year later, it left the red numbers behind and earned €15.7 million, which fell to €11.6 million in fiscal 2022 and €6.1 million in 2023.

The company’s gross operating profit (ebitda) has also been declining, although not as sharply. In 2004, the company recorded an ebitda of €19.3 million, compared to €24.4 million, 20.9% less. Over the last four financial years, the company’s ebitda has been reduced by 1.7 times.

Part of the reduction in Bimba y Lola’s profitability is the result of stagnant sales, in the midst of an investment phase to reposition the brand and to reinforce infrastructure, with the launch of a new corporate headquarters, for example. The company closed 2024 with revenues of €234.2 million, compared to 227.1 million in 2023 and 224.9 million in 2022.

Bimba y Lola’s projection is very different from eight years ago, when the company decided to cancel the process to open its capital, a transaction in which groups such as Permira and Carlyle had been interested. At that time, the company’s sales were growing at rates of 18% (up to 181 million in fiscal 2017) and ebitda exceeded €33 million (up 53% in 2017).

It is also eight years since the appointment as CEO of José Manuel Martínez Gutiérrez, who joined the company from Esprit to implement the 2018-2022 strategic plan. The company then set itself the goal of accelerating its internationalization: if in 2017 international sales accounted for 26% of the total, by 2024 this percentage had already risen to 56%.

In parallel with the reduction of dependence on the Spanish market, Bimba y Lola has also managed to shrink the weight of accessories in its sales, although they still represent 70%, while 30% corresponds to textile items. By channels, the group’s online share stands at 21%, while the rest comes from physical stores. At the end of 2024, Bimba y Lola had 310 stores, compared to 289 twelve months earlier.