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IC Companys experiences substantial pressure on gross margin
19
Aug '11
IC Companys A/S announces Annual report for 2010/11. Consolidated revenue for the financial year 2010/11 rose by 12% to DKK 3,925 million which was attributable to growth in both the retail and wholesale segments. The Group's gross margin, which has been under pressure from the Group's sourcing and wholesale market, was 59.1% corresponding to a reduction of 1.7 percentage points compared to last year. However, this setback was more than compensated by an improved cost rate. Consolidated operating profit for the financial year 2010/11 amounted to DKK 321 million corresponding to an increase of 14% which is satisfactory as it includes total non-recurring costs of DKK 28 million.

Revenue for the financial year 2010/11 amounted to DKK 3,925 million (DKK 3,495 million) corresponding to an improvement of 12% compared to last financial year. The last reported outlook indicated a level of DKK 3,900-4,000 million. Revenue for Q4 2010/11 amounted to DKK 717 million corresponding to an increase of 13% compared to Q4 2009/10.

Wholesale revenue amounted to DKK 2,395 million (DKK 2,121 million) corresponding to an increase of 13% compared to last financial year. Wholesale revenue for Q4 2010/11 rose by 17% to DKK 347 million compared to Q4 2009/10.

Retail revenue amounted to DKK 1,531 million (DKK 1,374 million) corresponding to an increase of 11% compared to last financial year. Retail revenue for Q4 2010/11 rose by 10% to DKK 371 million compared to Q4 2009/10.

Gross profit amounted to DKK 2,322 million (DKK 2,124 million) corresponding to an improvement of 9% compared to last year. The Group thereby generated a gross margin of 59.1% (60.8%). The gross profit for Q4 2010/11 improved by 7% to DKK 417 million.

Capacity costs amounted to DKK 2,000 million (DKK 1,842 million) corresponding to an increase of 9% compared to last year. The Group thereby achieved a cost rate of 51.0% (52.7%). Capacity costs for Q4 2010/11 amounted to DKK 461 million corresponding to a reduction of 1% compared to Q4 2009/10.

Operating profit amounted to DKK 321 million (DKK 283 million). The Group thus generated an EBIT margin of 8.2% (8.1%). The last reported outlook indicated a level of DKK 320-360 million. Operating loss for Q4 2010/11 amounted to DKK 44 million which is an improvement of DKK 32 million compared to Q4 2009/10.

Investments for the financial year 2010/11 amounted to DKK 102 million (DKK 123 million) which is lower than expected (the last reported outlook indicated a level of DKK 130-150 million). This deviation is attributable to IT investments being transferred to the financial year 2011/12.

Order intake for the winter collection 2011 is expected to record a setback of 5%.

The Board of Directors recommends that a dividend of DKK 74 million corresponding to DKK 4.50 per ordinary eligible share is distributed.

Based on the achieved results, the Board of Directors expects to grant the Executive Board 143.770 warrants.


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