Positioned as a leading authentic sports brand with an Italian heritage and riding on a strong retro trend, Fila has seen its revenues grow at a double-digit rate in many countries, judging from the financial report issued by the Korean owner of the Italian brand, Fila Korea, for the second quarter ended on June 30.
Including the results of Acushnet, the golf company in which Fila holds a 53 percent stake, total revenues expanded by 14.0 percent to 790.2 billion Korean won (€616.2m-$703.2m) during the quarter. Taking out Acushnet's sales, the remaining business reached approximate revenues of around $478.1 million, up from $428.0 million in the same quarter a year ago. This figure includes the royalty income from the brand's 37 licensees around the world, including Ochsner Sport for much of Europe, but not its 15 percent stake in a joint venture with Anta Sports for China.
Fila's licensees paid royalties of KRW 12.7 billion (€9.9m-$11.3m) for the quarter, 44 percent more than a year ago, with strong gains in Asia and Europe, the Middle East and Africa (EMEA). The increases ranged from 24.0 percent in Asia to 81.4 percent in EMEA and 93.7 percent in South America.
Fila's U.S. subsidiary raised its sales by 20.7 percent to KRW 102.2 billion (€79.7m-$90.9m), and its net income more than doubled to KRW 4.62 billion (€3.6m-$4.1m) as the gross margin increased by 1.8 percentage points to 31.4 percent and the operating margin by 2.1 percentage points to 6.7 percent.
In the domestic Korean market, where the company operates 582 mono-brand stores, Fila's sales jumped by 36.9 percent to KRW 130.6 billion (€101.8m-$116.3m), generating a sharply improved operating margin of 14.2 percent increase for the business unit, in spite of a slightly reduced gross margin of 60.5 percent, and raising its net income by 66.5 percent to KRW 16.2 billion (€12.6m-$14.4m).
The net profit of the whole group went up by 73.5 percent to KRW 81.1 million (€63.2m-$72.2m). The gross margin inched up by 0.4 percentage points to 51.2 percent and the operating margin increased by 2.9 percentage points to 14.6 percent.