CEO Oliver Samwer: Rocket Is Progressing Towards Profitability


Rocket Internet SE said losses have narrowed at several of its key startups in the second quarter, reports Bloomberg.

Chief Executive Officer Oliver Samwer is seeking to prove he can turn at least three of them into profitable businesses by the end of next year, the company announced today.

Sales rose at clothing retailer Global Fashion Group, food-delivery startup Foodpanda and home-furnishing business Westwing, while adjusted losses before interest, tax, depreciation and amortization narrowed.

Rocket overall lost $692.5 million in the first half of this year.

Analysts have criticized the company’s reporting for a lack of transparency and questioned its ability to wring profitable growth out of companies that operate in commodity sectors in unproven markets.

As Tech in Asia reported, most of Rocket’s troubles were blamed squarely on under performing companies in its Global Fashion Group (GFG), of which Zalora is a part. Rocket reiterated this stance in a statement released today, explaining that “impairments at GFG weighed in on consolidated results.”

But it’s not all bad. Online food delivery startup Foodpanda witnessed a 72% increase in net revenue compared to the corresponding period last year. It announced a gross profit of $23 million, an increase of 72.5%.

“We are on track to meet our profitability targets, with at least three of our key portfolio companies turning profitable until the end of 2017,” adds Oliver Samwer in a statement today.

Rocket climbed 2.7% to 19.69 euros at 9:05 a.m. in Frankfurt, giving the company a market value of 3.3 billion euros.

Versions of this appeared in Bloomberg and Tech in Asia on September 22. Read the rest of the stories here and here.