Home / Knowledge / News / Apparel/Garments / IC Companys: Unusual warm weather affects Christmas sale
IC Companys: Unusual warm weather affects Christmas sale
19
Jan '12
At an extraordinary board meeting the Board of Directors of IC Companys A/S reviewed the preliminary financial results for H1 2011/12 which indicate a consolidated revenue of DKK 2,105 million corresponding to the same level as last financial year, and an operating profit declining from DKK 265 million to DKK 146 million after having adjusted for expected non-recurring costs of DKK 23 million.

During the months November, December and the first half of January the Group experienced a continuing slowdown in consumer spending which is partly due to the unusual warm weather during the autumn and winter and partly the worsened financial crisis. This development affected the important Christmas Sale. The competition for the consumers' money has therefore been even more fierce and the amount of sales campaigns and presale has shown to be extraordinarily high.

Consequently, all Group brands generated lower retail revenues than expected. The Group brands' wholesale also suffered from a higher rate of cancellations and returns than expected just as the sale in season was lower than anticipated. However, the impact of these factors varies to a large extent within the individual Group brands.

Management anticipates that the challenging market conditions will continue for the remainder of the financial year 2011/12 resulting in a substantial pressure on both revenue and gross profit. As a consequence hereof, the Group will thus continue throughout H2 2011/12 to defend its market position by means of sales promoting activities and campaigns.

However, the structural changes of the Group and the general cost reductions are expected to lead to a reduction of the cost base by DKK 40 million for H2 2011/12.

Based on these statements, Management expects the consolidated revenue for the financial year 2011/12 to attain a level of DKK 3.7-3.8 billion (previously announced outlook of DKK 3.9-4.0 billion). Under the present market conditions, Management expects a positive operating profit for H2 2011/12, however, should the market conditions deteriorate, the Group may possibly suffer a double-digit loss in million DKK for H2 2011/12. Previously, Management expected an operating profit for the financial year 2011/12 amounting to DKK 250-300 million after having adjusted for non-recurring costs of DKK 23 million.

Cash flow from operating and investing activities for H1 2011/12 amounted to an inflow of DKK 72 million corresponding to an improvement of DKK 42 million compared to last financial year. Under the present market conditions, Management also expects a cash inflow from operating and investing activities for H2 2011/12.

Chief Executive Officer of IC Companys A/S Niels Mikkelsen commented;

”Q2 2011/12 was expected to be challenging. Nevertheless, we must conclude that the market conditions have proven to be significantly worse than anticipated and the visibility continues to be very low. There is no doubt that we are not satisfied with the financial results, and we have worked very hard to adjust the Group for the challenging market conditions characterised by declining consumer confidence and willingness to buy. We therefore expect stronger development for the Group in the future. However, in spite of the hard times, we have still generated growth and enhanced profit in some brands as well as improved earnings in other brands even though their revenues did not increase.”

IC Companys

Must ReadView All

Textiles | On 22nd Apr 2017

Strong rupee & weak trade to affect textile exporters

Textile and apparel exporters' earnings and EBITDA margins will be...

Textiles | On 22nd Apr 2017

Myntra acquires InLogg

With an aim to strengthen supply chain and logistics, Flipkart-owned...

Textiles | On 22nd Apr 2017

Aditya Birla Group launches new variant Liva Crème

After its successful launch of high quality fabric Liva in 2015,...

Interviews View All

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Anavila Misra
Anavila Collection

Fashion shows are also encouraging and highlighting sustainable fashion

Frank Gossmann
Rotorcraft AG

‘RT3 motto is: Do not check millimetres, check colours.’

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
April 2017

April 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search