While Björn Borg’s consolidated net sales were 165.6 million Swedish kronor (€13.9m) in Q2 2023 compared to SEK 161.5 million (€13.5m) in the same period last year (+3 percent), net sales decreased by 2 percent in constant currency, which can be explained by lower sales in stores due to store closures. In addition, distribution decreased significantly. “Our distributors are losing heavily compared to last year, which can be attributed to both the timing of deliveries and large inventories at our distributors’ customers,” said Henrik Bunge, CEO of Björn Borg AB.
At the same time, Björn Borg’s online business is performing like clockwork, with net sales of SEK 76.5 million (€6.4m) compared to SEK 52.0 million for its own e-commerce and e-tailers, an increase of 47 percent. Sales for own e-commerce increased 39 percent to SEK 37.5 million (€3.1m), compared to SEK 27.0 million in the prior-year period. “Above all, it’s our sports collection that makes me extremely proud, with an incredible development in our own e-commerce - not only during the second quarter of the year with an increase of 98 percent, but for the entire first half of the year with an increase of 100 percent,” commented Bunge.
Operating profit, in turn, increased by as much as 55 percent, from SEK 5.2 million to SEK 8.1 million (€679,500). Adjusted for currency effects, operating profit amounted to SEK 7.8 million (€654,400), an increase of 50 percent.
In terms of regions, Björn Borg has seen a very strong recovery in Germany, which has grown by 39 percent. The Netherlands, Denmark and Finland are also developing well. At the same time, sales in Sweden declined slightly during the quarter due to challenges with the brand’s physical wholesale customers. Belgium also performed weakly during the quarter, as several external e-tailers, mainly based in Germany and the Netherlands, are focusing on the Belgian market and successfully selling products to Belgian consumers, which to some extent explains the sharp decline in Björn Borg’s Belgian wholesale accounts.
In terms of product segments, the sportswear category continues to perform very well, growing 14 percent, while bags grew 3 percent. Both underwear and footwear were down 4 percent in the quarter. The decline in underwear was entirely due to the timing of retailer sales, the company said. Other categories grew 19 percent overall in the quarter. “Above all, it is our sports collection that makes me extremely proud, with an incredible development in our own e-commerce, not only during the second quarter of the year with an increase of 98 percent, but for the entire first half of the year with an increase of 100 percent,” Bunge said. As a result, the brand is now shifting its footwear segment significantly into sports. Björn Borg, synonymous with underwear, repositioned itself toward sports a few years ago. The footwear segment is now following the same path, with the intention of creating “more power in the brand.”
After the close of the second quarter, Bunge said his company’s strong start to 2023 has continued, with growth, increased profitability and a brand that is constantly being strengthened. “I am humbled by all the challenges in the world around us, but strengthened in my conviction that for our team, all our employees, nothing is impossible.” During the quarter, an anonymous employee survey showed that those who work at Björn Borg feel very good, and when they feel good, they perform well. “During the quarter, we saw the evidence of this high performance,” said Bunge. “A sports collection that continued to develop very well, very strong growth for own e-commerce, an improvement in earnings and the continued strengthening of the brand. Recession or not, based on our second quarter performance, I can now state that we are one step closer to our dream to build a global sports fashion brand.”
