Holding a press conference in Stockholm, Swedish brand New Wave Sports has announced net sales of SEK 2.4 billion (€208.2m) for Q2 – 4 percent higher than last year. In addition to Corporate and Gifts, Home & Furnishings, the company maintains a separate Sports & Leisure segment, which includes the Craft, Tenson and Cutter & Buck brands, among other handfuls.
The biggest sports news for sure was that during Q2 the company introduced Craft teamwear onto the US and Canadian markets. CEO Torsten Jansson said he is very positive about this venture.
“The launch of Craft teamwear in Canada and the US has finally started. We’ve been planning it for a couple of years,” Jansson said. “And I think the customers have reacted in very positive ways. We still don’t have a big stock of goods, but we’ll be building it up during Q3, Q4 and Q1 2025. But if we achieve the same success there as in Europe, this will make us grow much quicker again in percentages. In the beginning of the first year it will cost some money, of course, but as usual I see it as an investment. But it’s very, very interesting, and in January [2025] we’ll be at the biggest fair, so we’ll get some broad exposure from January.”
Jansson then went on to comment on the Q2 report in detail. Net sales for New Wave Group in total amounted to SEK 2.397.9 million (€208.2m), which was 4 percent higher than last year’s SEK 2.304.5 million (€199.9m). Currency changes affected net sales positively by 1 percent. Operating results declined from SEK 363.9 to SEK 301.2 million (€31.6m to €19.9m), in part because of overall increased costs as well as increased market investments. Cash flow from current operations improved by SEK 107.4 million (€9.3m) and amounted to SEK 337.5 million (€29.3m).
One thing in the Q2 report was a disappointment, the CEO said.
“This is our best Q2 result ever, but I’m a little disappointed in the sales, even if they’re actually over the estimations and we’ve returned to growth. I thought the market would turn around when they cut the interest rate and talked about cutting it some more. I felt that the consumers were under quite a bit of pressure and that the higher costs had hit them harder now than before. I thought it would be the right time to be more positive and make them open their wallets again. But we’ll take more market shares if we look at other brands in the same segment.”
Last fall New Wave bought Swedish sports brand Tenson for the symbolic amount SEK 1 (€0.1) excluding stock value, and Jansson said earlier this year that New Wave is interested in acquiring more sports brands, even several, in the coming year. SGI Europe asked directly for details. Could the group buy a bike brand? “Absolutely,” he said, “but it would have to be a really strong brand.”
But could Jansson give a hint as to the type of brand New Wave was looking for?
“We have no plans to acquire competing brands. And also; we’re big in team wear for football, for example, but we don’t have shoes or accessories. In outdoor we don’t have cooking or footwear. We’re quite picky with acquisitions. We want to be sure about a new brand, and sure that we can develop it over time.”
The operating result amounted to SEK 486.8 million (€42.2m) for the whole group and the result for the period amounted to SEK 331.4 million (€28.7m). Cash flow from operating activities amounted to SEK 541.1 million (€46.8m), and the net debt-to-equity ratio amounted to 30.3 percent (42.8 in Q2 2023).
An interview with New Wave Sports Group CEO Torsten Jansson with more details on Q2, the US/CAN teamwear venture and, of course, future sports acquisitions will be published next week in SGI Europe, when our office opens again after the holidays.
