14 September 2021
The Weekly
Spain

Push the EBIDTA to €1.7 bn, double profits and make the online channel responsible for 30% of sales, these are three of the main objectives El Corte Inglés set for itself in July, when it signed the five-year strategic plan at its annual shareholders' meeting. The department store chain has begun to take its first steps to complete the 180-degree turn to its business model and thus return to the path of growth. So far, the company had already drawn the first lines of this roadmap. One of them was the differentiation of its offer, with the aim to position itself in the premium segment, as showed with the acquisition of the Sánchez Romero supermarkets for approximately €30mn. El Corte Inglés is expected to continue exploring operations in other divisions, such as fashion. Another area of changes is in the logistics field.

Its real estate assets - about 10mn m2 valued at €16,457mn - has for years been an advantage over other competitors, but the health crisis and the change in consumer habits has forced the chain to rethink what to do with the surplus of commercial surface. The company has already converted part of the centres into outlets, while others have been sold or have become warehouses.

Regarding the development of the online channel, it increased from 5.3% of total sales to 12.84% in two years. The last point to work on is diversification. With the arrival of new competitors in the divisions that the chain has traditionally been strong, El Corte Inglés is looking at other booming business niches, such as alarms, with Sicor; telecommunications, with MásMóvil and cryptocurrencies in the financial segment through trademark registration. The company also plans to open its first hotel in Madrid. It will involve an investment of €6.8mn.

The objective is to transform 1,200m2 into a 113-rooms hotel, positioned at least with 4 stars.

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