Romania-based Vivre Deco, one of the largest online home and lifestyle retailers in Central and Eastern Europe, saw its turnover decrease by 45% in the first half of this year, forcing its current management toward drastic cuts. The company’s bonds recorded another steep drop on the Bucharest Stock Exchange after the report.

The decrease in turnover was determined by the cumulative effect of some unfavorable factors, among which increased operational costs, a change in customer purchasing preferences from online to offline sales as a result of the removal of COVID-19 restrictions, and diminishing consumer purchasing power due to the effects of the conflict in Ukraine.

Along with the drop in turnover, the company also saw its losses deepen to RON 18.6 mln (EUR 3.8 mln) from RON 17 mln in the first half of 2021.

Călin Fusu, who took over Vivre’s management after Monica Cadogan resigned, criticized the previous management team for its strategy of increasing turnover and market share at unsustainable costs in the long-term, according to Profit.ro.

The new management has made massive cost reductions in the last six months, more than halving commercial debt from RON 46 mln to RON 21 mln. Outstanding tax debts, however, increased to RON 13 mln, and a lowered liquidity might mean that creditors could attempt to force the company into insolvency.

Vivre Deco announced losses of RON 84.7 mln for 2021 compared with a profit of RON 7.4 mln the year before that, as its turnover also went down from RON 300 mln to RON 250 mln.

Romania made up 44% of Vivre’s turnover in 2021, followed by Bulgaria (14%), Croatia (12.2%), and Hungary (9.5%).

Vivre has two bond issues in euro listed on the Bucharest Stock Exchange. The value of the two bonds, with maturities in 2025 and 2026, dropped by 15% and 14%, respectively, on September 1, after the company released its financial report for H1. In the last six months, the two bonds have lost 55%, respectively 60% of their value.

radu@romania-insider.com

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