Björn Borg sees continues sales & profit growth in weak market
Björn Borg AB releases Interim Report from January to September 2008.
Third quarter, July 1 – September 30, 2008
• Brand sales increased by 7 percent to SEK 704 million (657).
• The Group's net sales rose by 8 percent to SEK 160.8 million (148.6).
• The gross profit margin was 54.1 percent (54.6).
• Operating profit increased by 1 percent to SEK 49.7 million (49.2).
• Profit after tax increased by 7 percent to SEK 37.6 million (35.2).
• Earnings per share increased by 6 percent to SEK 1.50 (1.42). Fully diluted earnings per share amounted to SEK 1.50 (1.41).
Nine-month period January 1 – September 30, 2008
• Brand sales increased by 18 percent to SEK 1,869 million (1,584).
• The Group's net sales rose by 11 percent to SEK 395.3 million (355.1).
• The gross profit margin was 53.7 percent (53.4).
• Operating profit rose by 3 percent to SEK 102.7 million (99.8).
• Profit after tax increased by 6 percent to SEK 76.4 million (71.8).
• Earnings per share increased by 3 percent to SEK 3.05 (2.96). Fully diluted earnings per share amounted to SEK3.04 (2.92).
Comment from the President - “Björn Borg continued to develop positively during the quarter. We look to the future with cautious optimism while monitoring factors in the marketplace that might affect consumers. At the same time, we are concentrating on the long-term development and further expansion of the Björn Borg brand and the company,” says the new president, Arthur Engel.
Several of Björn Borg's markets continued to report good growth during the quarter, and the Group increased both its sales and earnings. At the same time weaker consumer spending affected Björn Borg's development in Sweden as well as several of our 15 other markets.
Among new markets, Spain and England stood out with strong sales trends during the quarter – through higher average orders and the addition of new retailers. Several of our established markets also noted fine sales figures. Finland and Belgium grew by nearly 40 percent, though from low levels, and our largest market, the Netherlands, saw a sales increase of 12 percent.
We have left a good platform that my successor as President, Arthur Engel, and our new Sales Director and Vice President, Henrik Fischer, will now take responsibility to manage and develop. They both have the competence and experience to run an international business and expand a strong brand.
Estimated brand sales, i.e., sales of Björn Borg products at the consumer level, including VAT, based on reported wholesale sales, amounted to SEK 704 million (657) during the third quarter, an increase of 7 percent year-to-year. During the nine-month period brand sales amounted to SEK 1,869 million (1,584). On a rolling 12-month basis, brand sales amounted to SEK 2,523 million.
In the clothing product area, brand sales decreased by 2 percent during the third quarter compared with the same quarter last year, mainly due to lower sales in Denmark, the Netherlands and Norway in the women's underwear segment. Sales in the footwear product area nearly doubled as a result of substantially higher exports primarily to the Netherlands and Denmark.