Van de Velde NV

Income statement: notes and sources

Notes: Gross profit is not reported in the press releases reviewed (Van de Velde's IFRS P&L presents revenue and operating expense categories; gross margin is not a headline KPI). FY2025 EPS from Google Finance (EUR 1.42); other years' EPS not captured from primary sources. FY2024 dividend of EUR 2.40 inferred from the FY2025 release describing EUR 2.40 as a "stable" dividend. The FY2023 release states the FY2022 dividend was EUR 2.276 per dividend-entitled share (vs EUR 2.20 per share proposed in the FY2022 release) — the difference reflects the per-entitled-share calculation after treasury shares; both figures noted. Pre-tax income: not separately captured; derivable only approximately.

Margins (derived from reported figures)

Revenue CAGR FY2021–FY2025: reported ≈ 0.9% p.a. (195.3 → 202.4); comparable ≈ 1.6% p.a. (191.2 → 203.4) (derived). From the FY2022 peak, comparable revenue has declined at ≈ −1.3% p.a.

Commentary. The five-year arc has three phases. (i) Post-COVID rebound (2021–2022): comparable revenue rose 19.1% in 2021 and 10.6% in 2022 as boutiques reopened and swim recovered after two years of travel restrictions; comparable EBITDA reached a record EUR 58.0m in 2022 at a 27.4% margin. (ii) Plateau (2023): reported revenue flat at EUR 211.3m; swim strength in H1 offset weak lingerie sell-in as independent retailers worked down high end-2022 inventories; pricing power and cost control held comparable EBITDA margin at 26.7%. (iii) Erosion and reset (2024–2025): comparable revenue fell 3.0% in 2024 and 1.1% in 2025; H1 2024 B2B dropped 9.4% amid a difficult spring for fashion, while the company deliberately raised marketing activation and absorbed wage inflation (Belgian wage indexation), compressing H1 2024 comparable EBITDA by 15.1%. In 2025, weak swim pre-orders (high customer inventories) and US tariff disruption hit H1; H2 2025 returned to 1.9% growth with comparable EBITDA up 2.3%. The FY2025 net-profit collapse (−44.3%) is largely non-cash: a EUR 9.6m impairment and equity loss related to Top Form; underlying net profit ex-Top Form fell 13.8% to EUR 27.4m. H1 2026 confirms stabilisation: comparable revenue +4.0%, but comparable EBITDA −1.6% due to temporary costs (assortment expansion, production diversification, inventory write-downs).

Balance sheet: notes and sources

Notes: FY2024 cash of EUR 58.9m is derived from Google Finance's −15.03% change to EUR 50.06m in FY2025; FY2025 cash EUR 50.1m from the FY2025 release. FY2022 and FY2024 solvency derived (equity/total assets). FY2021 current liabilities from the FY2022 release comparative. Total debt split (short/long), goodwill and intangibles were not captured from primary sources; the group carries no material bank debt — liabilities consist chiefly of trade payables, provisions and IFRS 16 lease liabilities (not separately quantified in sources reviewed). Net debt is therefore negative (net cash), approximately equal to cash less lease liabilities. Company-reported liquidity: current assets 4.5x current liabilities (FY2023) and 3.6x (FY2025). H1 2026 solvency: 71.7% (seasonal, post-dividend).

Cash flow: notes and sources

Notes: FY2025 OCF (EUR 37.09m), FCF (EUR 25.25m) and financing outflow (EUR 38.62m) per Google Finance; FY2024 values derived from Google Finance YoY changes (−19.23%, −19.33%, +6.42%). Dividends paid in cash and the actual amount spent on buybacks per year were not captured separately; financing outflows (~EUR 36–39m) are consistent with ~EUR 30m dividends plus partial buyback execution and lease repayments. Buyback ceilings reflect annual programmes approved 2022 (ending Feb 2023), 1 Mar 2023, 28 Feb 2024, 26 Feb 2025 and 4 Mar 2026. H1 2026 capex: EUR 10.2m (vs EUR 3.5m H1 2025), mainly the new Wichelen logistics site and digital platforms.

Ratios (derived)

Ratio commentary. ROE of ~20% in 2022–2024 is exceptional for a debt-free apparel company and reflects both high margins and active capital return (buybacks plus cancellations, e.g., 260,063 shares cancelled in June 2023). The FY2025 drop to 12.3% is impairment-driven; on underlying net profit (EUR 27.4m) ROE would be ~18.9% (derived). Debt/equity, net debt/EBITDA and interest coverage are not meaningful given the net cash position and negligible financial charges (financial result between −1.3 and +0.3 EUR m). ROIC: not publicly disclosed; Google Finance cites return on capital of 13.65% for FY2025. Cash conversion cycle: not publicly disclosed; working capital has been tightened from EUR 48.1m (2022) to ~EUR 39m (2024–2025), primarily through inventory normalisation. The FY2025 payout of ~169% of reported EPS (EUR 2.40 vs EUR 1.42) is covered by cash rather than earnings — sustainable while the balance sheet remains over-capitalised, but it is an explicit return-of-surplus-capital policy (the FY2022 and FY2023 releases state the buyback's purpose is "to reduce the company's cash surplus").

Management guidance. No quantitative guidance. FY2025 outlook: continued focus on long-term strategy and brand strengthening via product renewal and additional points of sale, described as a solid basis for 2026, with vigilance toward external uncertainties. H1 2026 commentary: return to structural growth; temporary costs from assortment expansion, production diversification and inventory write-downs.

Consensus expectations. Only partial: an analyst-based 2026 P/E of ~12.4x (aktien.guide) implies 2026E net profit of roughly EUR 30m (derived), i.e., a rebound to near FY2024 levels absent further impairments. KBC Securities' EUR 38.50 target implies ~29% upside from EUR 29.80.

Bull case.

1. Growth has turned: H1 2026 comparable revenue +4.0% with D2C +15.2% — the first meaningful growth half since H1 2023 — while B2B has stabilised (flat at EUR 82.4m).

2. Earnings normalisation: stripping out the EUR 9.6m Top Form item, underlying FY2025 net was EUR 27.4m; H1 2026 net already EUR 16.1m. A return to ~EUR 30m net profit puts the stock on ~12–13x with an 8% yield.

3. Capital return and optionality: ~EUR 50m cash, no debt, EUR 15m annual buybacks (~4% of market cap) plus EUR 2.40 dividend; a new CEO with Levi's brand/retail experience could unlock D2C scaling or bolt-on M&A.

Bear case.

1. Structural B2B decline: comparable B2B down ~12% from 2022 to 2025; independent boutiques are a shrinking channel and D2C (28%) cannot yet offset.

2. Margin creep down: comparable EBITDA margin fell from 27.4% (2022) to 23.2% (2025), and H1 2026 EBITDA still declined despite revenue growth; D2C mix carries higher fixed costs.

3. Supply-chain and governance risk: loss-making associate Top Form (equity result −EUR 1.1m H1 2026), tariff exposure in North America, and repeated CEO turnover raise execution risk; low liquidity (~6k shares/day) limits institutional appeal.

Key catalysts and monitorables (next 12 months).

• New CEO's first strategic communication (possibly with FY2026 results, expected ~early March 2027).

• FY2026 results: H2 2026 B2B trend, D2C growth sustainability, comparable EBITDA margin vs 23.2%.

• Swim pre-orders for summer 2027 (renewed Marie Jo/PrimaDonna swim).

• Top Form: further impairments/equity losses; progress of Thailand transfer and new partner qualification.

• North America tariff developments.

• Wichelen logistics site completion and capex normalisation.

• Renewal of buyback programme (current one expires ~March 2027) and FY2026 dividend (EUR 2.40 maintenance).

• Any portfolio action (retail banner rationalisation, acquisitions).

Concluding analyst verdict.

Van de Velde is a high-quality but ex-growth niche champion at an inflection point. Its economic engine remains enviable: a debt-free balance sheet, solvency near 78%, comparable EBITDA margins in the mid-20s and consistent cash generation fund an ~8% dividend yield plus annual buybacks — a total shareholder yield above 12% at current prices. The FY2025 earnings collapse was largely a non-cash accounting reset on the Top Form stake rather than an operational breakdown, and H1 2026 delivered the first convincing top-line growth in three years, led by a D2C channel growing at mid-teens rates and a stabilised B2B base.

The bear points, however, are structural rather than cyclical. The independent-boutique channel that built the company is shrinking, swim exposure introduces volatility, and the shift toward D2C — while strategically correct — dilutes margins through fixed retail and digital costs, as shown by H1 2026 EBITDA declining despite revenue growth. Supply-chain diversification away from a struggling associate and tariff-exposed routes is necessary but costly in the short term. Governance is the wild card: a controlled company with six CEO arrangements since 2014 must now give Marc Dambremez the latitude to modernise brand-building and speed to market, a mandate the board has explicitly endorsed.

On balance, the valuation (~7x EV/EBITDA, ~13x underlying earnings, ~2.6x book) already discounts low growth, and the capital-return floor limits downside. The investment case therefore hinges on whether the new CEO can convert D2C momentum and assortment renewal into sustained low-to-mid single-digit growth while holding EBITDA margins above ~23%. Failure to stabilise margins, or further Top Form or tariff shocks, would turn the story into a pure yield play.