The Swedish-based New Wave Group, which owns sports brands like Craft and Cutter & Back and distributes several others, saw total sales in the fourth quarter increase by 23 percent to 2,307 million Swedish kronor (€218.7m-$249.3m), with the growth driven by the Sports & Leisure segment. At constant currency rates, sales rose by 22 percent.
New Wave’s gross margin expanded to 47.8 percent in the quarter against 46.2 percent the year earlier. Operating earnings jumped by 42 percent to SEK 403.3 million (€38.2m-$43.6m), widening the operating margin to 17.5 percent from 15.1 percent. Net profit improved to SEK 308.5 million (€29.2m-$33.3m) from SEK 208.2 million in the year-earlier period.
In the quarter, the Sports & Leisure unit’s sales jumped by 35 percent to SEK 921.1 million (€87.3m-$99.5m), with higher sales in all geographical regions and on both retail and promo sales channels. The segment’s operating profit improved to SEK 466.0 million (€44.2m-$50.4m) from SEK 170.5 million.
Sales at New Wave’s corporate segment grew by 18 percent to SEK 1,005 million (€95.2m-$108.6m), generating an operating profit of SEK 186.6 million (€17.7m-$20.2m) versus SEK 139.9 million.
Group sales via the promo sales channel increased by 16 percent, while retail sales improved by 36 percent.
By geographical region, group sales in the U.S. increased by 27 percent in the quarter. They rose by 23 percent in Sweden, by 17 percent in the Nordic region outside of Sweden and 21 percent in Central Europe, but they were off by 4 percent in Southern Europe.
New Wave’s sales were up overall by a reported 10 percent to SEK 6,719 million (€636.9m-$726.2m) for the full year, reflecting 13 percent growth in local currencies. The growth was here again led by Sports & Leisure, which saw a 29 percent sales increase to SEK 2,792.5 million (€264.4m-$301.4m) for the year.
The gross margin rose to 48.1 percent from 43.2 percent in 2020, as the weight of trading operations in the corporate segment, which enjoys lower gross margins, decreased. Operating income jumped to 1,006 million (€95.4m-$108.7m) from SEK 545.9 million. Net profit more than doubled to SEK 760.0 million (€72.1m-$82.2m) from SEK 363.0 million the prior year.
“We are entering 2022 stronger than ever, and it is difficult not to be optimistic about the development we have had,” said Torsten Jansson, CEO. “Sports & Leisure with Craft is at the forefront with fantastic development opportunities, and the previously challenged Gifts & Home Furnishing is demonstrating promising development.”