The Handelszeitung wrote this in its latest edition. "The fraud includes embezzlement, falsification of documents and fraudulent financial reporting in the years 2012 to 2016," reads the latest Trendsales annual report. It was not until the spring that Tamedia discovered the allegedly culpable Trendsales CEO, dismissed him without notice and filed criminal charges against Rasmus Goth Engel.
Trendsales eroded its equity due to further losses in 2016. The Copenhagen-based internet company with around 40 employees was on the brink of collapse at the end of 2016. Tamedia therefore had to inject 3.4 million Swiss francs into the second-hand portal a few days ago. This financial injection has ensured Trendsales' survival for the time being. Nevertheless, the Danish e-commerce acquisition has been a loss-making business worth millions for years, as Handelszeitung writes with reference to the business transactions.
Tamedia spokesperson Christoph Zimmer emphasizes: "The fraud case does not change the fact that Trendsales is one of the transaction platforms with the widest reach in Denmark and the clear market leader in the vintage fashion sector." According to Zimmer, the capital injection has now laid the foundation for "further growth". The Tamedia spokesperson expects to "return to the black" in 2017, although this also depends on further "investments in growth".
The Trendsales case has become a matter for the boss at Tamedia. Since mid-December, Chief Digital Officer and Group Management Board member Christoph Brand has been personally overseeing the fortunes of the Danish second-hand retailer as President. As the former head of Sunrise - then a subsidiary of Danish Telecom - he is very familiar with the Nordic environment. Brand told the Handelszeitung newspaper that he had "seen many a case of fraud, but none on this scale compared to the company's size".
Tamedia acquired Trendsales in July 2014 (Werbewoche.ch reported). According to research by the newspaper, the media company is said to have paid around 35 million francs for the portal at the time. Too much, as it turns out today. The falsified balance sheets showed incorrect figures. For example, Trendsales did not make a net profit of CHF 400,000 in 2014 as claimed, but instead posted a loss of over CHF 1 million. And the equity ratio was not 77% as stated, but only 43%.
In addition to the shoddy management of past years, Tamedia is also facing further challenges in the Trendsales case. The second-hand platform's losses doubled in 2015 and are likely to increase again in 2016 - the business model threatens to become a slow seller. The in-house payment solution TSPay is being put under pressure by local banks' mobile payment options and business in Germany is struggling after the expansion. (HZ/hae)