In the first quarter of 2014, the Marimekko Group’s net sales fell by 6 percent relative to the same period last year and amounted to EUR 19.4 million (20.7). The decline in net sales is explained partly by a change in the rhythm of deliveries for wholesale: a large proportion of the products in the spring 2014 collection were delivered as early as December 2013, unlike the previous practice.
Operating result was EUR -1.7 million (-1.3). Operating result excluding nonrecurring items improved in spite of the downturn in sales and was EUR -1.1 million (-1.3). The closure of manufacturing operations located in Sulkava and Kitee, enhanced production efficiency at the textile printing factory in Helsinki as well as reorganisations in the United States and write-downs of company-owned stores contributed to the improved result.
The business climate for retail trade continued to be challenging, in Finland even more so than had been expected. In order to reinforce business competitiveness and to attain a more efficient organisational structure, during the period under review Marimekko conducted consultative negotiations concerning all operations in Finland with the exception of the personnel at the Helsinki textile printing factory. Arrangements were also made in the United States. Moreover, Marimekko initiated an international recruitment process for a new Creative Director for the company.
In 2014, Marimekko will continue to invest in growth while focusing on enhancing the operations of its stores, on improving the overall profitability of its business, and on creating even more attractive design and products.
Mika Ihamuotila, President and CEO, said, “The present-day business climate for retailing sets challenges for us as for other players in the trade. Consumer and corporate confidence has been low and, although a small upturn was detectable in March, consumers in Finland are still very cautious. The weak trend in Marimekko's retail business which started in the second quarter last year has continued in the early months of this year. I am, however, confident about growth in Asia in particular, and I am also pleased that our dependence on the domestic market has diminished.