Fenix Outdoor International's profit improved slightly despite vastly increased sales last year, as the strong performance of the group's brands and its Swedish retail business was mitigated by the charges affecting its retail division after the acquisition of Globetrotter, the German outdoor retailer.
Martin Nordin, chief executive of the formally Swiss but Swedish-based company, said in a statement that Fenix has gone through an intense year. It was marked by the integration of Globetrotter as well as the continued expansion of its brands, from Fjällräven to Hanwag, Brunton and Primus. They advanced rapidly in North America and performed strongly in several Asian and European markets. The group added that the cold weather in northern Europe in January supported its sales in the first quarter of this year.
In spite of the relatively warm weather at the end of the year, Fenix enjoyed a sales increase of about 38.3 percent to €43.0 million in the last quarter of 2015 for its brands. The turnover includes 19 brand stores, after 8 store openings since the same quarter in 2014. The operating profit for the brands jumped to €6.2 million for the three months, up from €0.6 million.
Meanwhile the turnover of the retail division, comprising of Globetrotter along with Naturkompaniet in Sweden and Partioaitta in Finland, more than doubled to €67.5 million, up from €19.8 million. The operating result remained negative but with an operating loss of just €0.1 million, against a loss of €2.7 million for the same quarter the previous year.
The whole Fenix group thus ended the quarter with sales of €110.5 million, more than twice the €55.6 million reported for the same quarter in 2014. Its operating profit reached €5.0 million, compared with a loss of €4.2 million. Fenix ended the quarter with net profit of €5.9 million, compared with a loss of €5.5 million.
For the full year, Fenix reaped net sales of €451.0 million, compared with €237.3 million the previous year. This included an increase of 10.6 percent to €189.9 million for the brands, while retail sales soared to €261.0 million with the inclusion of Globetrotter, up from €65.6 million.
The Fjällräven brand performed strongly last year, owing to its expansion in North America as well as investments in environmentally-friendly performance products. The rise was driven by pants and daypacks. Brunton and Primus were under stronger pressure from competition.
The turnover of the brands was on the rise in all markets other than Germany, due to the fact that sales to Globetrotter are no longer included.
While the Fjällräven brand only started exploring the North American market in earnest three years ago, sales for the brands division in the region reached €41.4 million last year, which was an increase of 52.2 percent. Sales in other international markets also amplified by 14.7 percent to €10.9 million.
The group's operating profit landed at €32.6 million, up by 12.8 percent from €28.9 million. It suffered an operating loss of €8.0 million for its retail division, against a loss of €3.0 million in 2014, which was attributed to Globetrotter. Then again, the brands division brought in an operating profit of €47.0 million, up by 21.8 percent, driven by the sales increase along with a stable gross margin and cost control.
The operating profit amounted to a sharp decrease in operating profit margin, down by 5.0 percentage points to 7.2 percent of net sales. Without the one-off charge that arose from the business analysis at Globetrotter, the group's operating result was about stable – making the decline sharper in terms of profit margin. Fenix ended the year with income of €21.8 million, up by 5.3 percent.
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