Improving Fenix Outdoor Gets Out Of The Norwegian Retail Market

Combining its wholesale and retail sales, the Swedish outdoor company raised its total net revenues by 15 percent to 368.6 million kroner (€39.5m-$50.5m) in the 1st half ended June 30, generating a 14 percent better net profit of 28.8 million SEK (€3.1m-$4.0m), as compared to the same period a year ago. Operating earnings rose by 17 percent to 43.7 million SEK (€4.7m-$6.0m), and they would have increased by 48 percent if currency exchange rates had remained the same.

The Naturkompaniet chain of outdoor stores and its other retail operations continued their strong recovery during the 6-month period. Their revenues grew by 28 percent to 90.3 million SEK (€9.7m-$12.4m), with a strong 31 percent increase on a same-store basis, and gross margins improved, leading to an operating profit of 2.6 million SEK (€0.28m-$0.36m) against a loss of 6.4 million SEK in the same period a year ago. Retail sales outside Sweden grew to 15.7 million SEK (€1.7m-$2.2m) from 10.7 million SEK, but this was due to the liquidation of closeouts in preparation for the shutdown on July 31 of the group closed its last store in Norway.

In the wholesale segment, Fjällräven and the other brands of Fenix Outdoor contributed an operating profit of 41.1 million SEK (€4.4m-$5.6m) – or 6 percent less than a year ago – in spite of a 12 percent increase in revenues to 278.3 million SEK (€29.8m-$38.2m). Sales increased by 11 percent on a comparable basis and grew strongly in Germany, thanks in part to the acquisition of Hanwag, reaching a level of 92.6 million SEK (€9.9m-$12.7m) in the country. They amounted to 26.8 million SEK (€2.9m-$3.7m) in Sweden, 46.2 million SEK (€5.0m-$6.3m) in the other Nordic countries and 53.3 million SEK (€5.7m-$7.3m) in the Benelux countries.

Currency exchange losses of 2.6 million SEK (€0.28m-$0.36m) led to a big drop of 9.9 million SEK (€1.1m-$1.4m) for the net profit of Fenix Outdoor’s parent company. In the corresponding 2005 period it had posted a net profit of 18.1 million SEK after currency exchange gains of 8.8 million SEK.