DOUGLAS reported Q3 FY26 sales of €987.8m, down 2.0%. Adjusted EBITDA fell much faster, dropping 19.4% to €127.5m, while margin declined from 15.7% to 12.9%. Offline store sales fell 2.5%, compared with a 1.0% decline online. On a like-for-like basis, stores were down 6.5%, against 1.1% for e-commerce. There were still areas of growth with cross-channel services rising 18%, retail media revenue increasing 24%, and exclusive brands growing 14.7%, but they were not large enough to offset weaker traffic, lower conversion, heavier promotions and cost inflation.
DACHNL, Douglas’s largest region at 47% of sales, declined 2.8%. Store sales were down 1.3%, but the like-for-like decline reached 6.5%. E-commerce also fell 4.9%. Weaker demand in Germany and the Netherlands, lower conversion and continued promotional activity all weighed down on the region.
France, which accounts for 17% of group sales, declined 2.1%. Stores fell 5.2%, or 8.2% like-for-like. E-commerce grew 10.8%, partly offsetting the store decline, but not the pressure on profitability. Adjusted EBITDA margin fell from 16.9% to 15.2% in a highly promotional market.
Central Eastern Europe was the outlier. Sales rose 4.4%, with stores up 1.3% and e-commerce up 14.6%. It was also the only region to deliver adjusted EBITDA growth. Margin was almost unchanged at 21.6%, compared with 21.7% last year. Expansion costs are rising, but Douglas is still finding growth in the region.
Southern Europe, representing 15% of sales, declined 3.9%. Stores were down 6.2%, or 7.4% like-for-like, while e-commerce grew 12.5%. The divergence in channel growth was similar to France, but the margin impact was heavier. Adjusted EBITDA margin dropped from 19.5% to 16.4% as weaker consumer sentiment and promotions weighed on sales and gross margin.
Parfumdreams and Niche Beauty were the weakest businesses, with sales down 10.4%. Douglas closed 11 Akzente stores during the quarter and is repositioning Parfumdreams as a pure-play e-commerce business. For now, strong online competition continues to hurt both sales and profitability. Adjusted EBITDA margin moved from 1.3% to -1.0%.
The issue for Douglas is the weight of each region. Central Eastern Europe is growing, but it represents only 17% of sales. DACHNL alone accounts for 47%, and both its stores and e-commerce are declining. For FY25/26, Douglas expects sales of €4.58bn to €4.63bn, an adjusted EBITDA margin of around 15.0%, and net leverage between 3.0x and 3.5x.
