Shares of Turkish denim and lifestyle retailer Mavi climbed 8.75% to 37.30 lira after the company presented its first-half 2026 results on September 17, highlighting margin expansion and a revised full-year outlook despite persistent inflation pressures in its domestic market.
Under IAS 29 inflation accounting rules, consolidated revenue for the January-to-June period fell 1.1% to TRY 25.832 billion. EBITDA, however, came in at TRY 4.679 billion with an 18.1% margin — essentially unchanged from the prior-year 18.2% figure. On a non-IFRS 29 basis, EBITDA grew 25% to TRY 5.048 billion with a 20.7% margin.
Gross margin improved to 53.1% from 51.3%, driven by a 2.3% rise in gross profit to TRY 13.71 billion under IAS 29. Without inflation adjustments, gross profit surged 33% to TRY 13.58 billion as revenue climbed 30%. Net income on an IAS 29 basis totaled TRY 807 million, a 40% decline from TRY 1.34 billion a year earlier, largely due to inflation accounting charges. Excluding those charges, net income rose 24% to TRY 2.313 billion with a 9.5% margin.
In the second quarter, revenue dipped 0.4% to TRY 12.553 billion. EBITDA grew 4% to TRY 2.065 billion, lifting the quarter's margin by 70 basis points to 16.4%. Net income increased 9% to TRY 239 million, while profit before tax more than doubled to reflect reduced inflationary impairments. Like-for-like sales in Turkey rose 31.3% nominally but fell 0.6% in real lira terms, with transaction volume up 3.5% and basket size down 3.9% in real terms.
Mavi operates 497 monobrand stores across 30 countries, with 360 retail outlets and 68 franchise locations in Turkey. International wholesale remains a drag, falling 14% in the first half, though its U.S. business grew 24% in Q2. Online sales in Turkey declined 1.1% in the quarter, and global e-commerce totaled TRY 2.391 billion, up just 0.2%.
The company ended the period with TRY 6.664 billion in net cash, excluding lease liabilities, and operational cash flow of TRY 4.216 billion with a cash conversion rate of 90%, up from 63% a year ago. Inventory fell 7% to TRY 8.074 billion.
Management revised its full-year revenue guidance down from "5% ± 1%" growth to a "low single-digit decline to flat" outlook under IAS 29, while keeping EBITDA margin guidance at 18.0% ± 0.5% and capex at 6% of sales. A second-phase share buyback of TRY 1 billion over one year was approved, with repurchased shares to be cancelled. The company plans to open 15 net new stores in Turkey, execute 15 expansions and 30 upgrades, and add six stores in North America for the full year.
Early momentum into the third quarter was strong: August Turkey retail sales grew 25% year-over-year with online sales surging 30%. Back-to-school traffic in the second week of September lifted retail sales another 24%.
