Another guidance downgrade

Research evidence excerpt

Another guidance downgrade

Deutsche Bank

Research

Rating Company Date

Hold Douglas 18 June 2026

Europe Reuters Bloomberg Rating Hold

Germany DOUn.DE DOU GR Price target (EUR) 10.50 Price at 17 Jun 26 8.65

45-week range 13.02 – 8.42

Retail

Retail - Non Food Valuation & Risks

Adam Cochrane

DB View Research Analyst

+44-20-754-17812 Douglas has released an ad-hoc trading statement downgrading its FY26

guidance again given weaker than expected trading in 3Q so far, a greater shift Shwetha Ramachandran

to online sales and a more promotional environment. This plays into the fears of Research Associate

the bears on the stock where there has always been a concern that Amazon and

other online retailers would take a bigger slice of the premium beauty market. We Benjamin Yokyong-Zoega

Research Analyst cut our sales forecast by c.-1% for FY26e but adj EBITDA by -7% which flows +44-20-754-12338

through to an EPS cut of -14%.

Management is attempting to accelerate its structural changes towards exclusive

products and reinforcing the omni-channel credentials but Douglas will be a net

loser from an accelerated channel shift towards online. The net debt/EBITDA

remaining above 3.0x in FY26 (DBe 3.2x) suggests the potential for a dividend

payment has been further pushed out. Currently trading on c.6x Cal 26 PE with a

9% FCF the valuation looks attractive but given the uncertainty on the outlook we

retain our Hold rating with a lowered €9 (from €10.5) target price.

Earnings changes

We lower our FY26e sales growth to 0.4% (guidance 0-1%) with negative store

sales offset by new store openings and online growth. We now assume gross

margin down -120bp (from -80bp) to reflect the increased promotional

environment. Despite working on managing the opex base we see further