Le Coq Sportif, the French sports brand, has returned to profits in the first half of this year, after two years of heavy investments. Owned by Airesis, a Swiss investment company, Le Coq Sportif reported a sales increase of 37 percent to €40.4 million and a net profit of nearly €0.6 million, compared with a loss of €8.2 million at the same time last year.
Airesis admitted that the sales growth was partly due to earlier deliveries of winter products. Le Coq Sportif’s turnover increased spectacularly in all three southern European markets on which it decided to focus three years ago: French sales soared by 111 percent to €16.7 million, Italian sales were up by 52 percent to €8.6 million and Spanish sales jumped by 76 percent to €1.3 million. In Spain, the brand is kicking off its sixth store, according to local reports.
Revenues from licenses increased by 15.9 percent to €3 million, chiefly reflecting the brand’s performance in the U.K. and the Benelux countries, but sales to distributors dropped by nearly 30 percent. There was no particular explanation behind this, other than reduced orders by existing distributors, due to the economic situation.
The brand’s gross margin fell by 3 percentage points to 45 percent, due to a slight shift in product mix and a spate of clearance deals. This came ahead of a strategic adjustment, including sharper focus on apparel, which will become apparent in product ranges from early next year.
However, Le Coq Sportif still returned a profit because its operating expenses were cut by about 18 percent to €16.7 million. The staff count was reduced to 180 people, compared with 195 at the end of June last year.
There was also some improvement at Boards & More, the Austrian board-sports group, which is the second company controlled by Airesis. Its reported sales declined by 3 percent to nearly €14.4 million for the six months, but they increased by 4 percent in comparable terms. The Mistral brand was sold last year, so that Boards & More consists of Fanatic, North Kiteboarding, North Sails Windsurf and Ion.
The group’s gross margin dipped by 1 percentage point to 40 percent for the period, but due to reduced expenses it managed an operating profit (Ebit) of €421,000, against an operating loss of €238,000 at the same time last year. Boards & More ended the six months with a net profit of €350,000.
The Airesis group therefore saw its consolidated sales increase by nearly 16 percent to about 82.5 million Swiss francs (€54.5m-$81.3m). Its gross margin slid by 1 percentage point to 44 percent but the higher sales and lower expenses restored its profitability. Airesis ended the six months with a net profit of just under CHF 1.6 million (€1.1m-$1.6m), compared with a loss of nearly CHF 13 million at the same time last year.
While presenting these results, the company’s supervisory board paid homage to Robert Louis-Dreyfus, the French businessman who passed away in July. A former shareholder and chief executive of Adidas, Louis-Dreyfus stood at the cradle of Airesis, one of its shareholders and a member of its strategic committee. Separately, in July, Urs Linsi, the former general secretary of Fifa, was appointed on the supervisory board of Airesis, following the resignation of Mauro Saladini.
