Rapala VMC Corporation has raised its stake in Peltonen's ski factory from 90 to 100 percent. It has also decided to establish an ice drill manufacturing operation in Finland by the end of this year to strengthen its position in the ice-fishing business, which it entered in early 2012 by acquiring some of the assets of Strike Master Corporation and the Mora brand of ice products.
The company finalized the establishment of a new manufacturing facility for fishing hooks on Batam Island in Indonesia at the end of the first quarter of this year. New products and new production phases will be added gradually over the next 12 to 15 months.
In releasing its results for the first quarter of this year, the Finnish fishing tackle specialist, which works closely with Shimano in some markets, also said that discussions regarding new acquisitions and business combinations continued during the period.
The new ice-fishing business helped to support Rapala's turnover in the first quarter, offsetting a delay in the sale of more profitable summer fishing products due to a shortage of products from external suppliers and the protracted cold weather in many parts of the globe. Sales in the quarter rose by 2 percent to €75.3 million, with particular strength in Russia, North America, Finland, the Baltic countries, Latin America and most of Asia.
Sales of group products, including Peltonen cross-country skis, rose by 3 percent to €47.1 million. Sales of third-party items increased by 1 percent to €28.1 million, driven by winter sports, outdoor and hunting products.
The late spring, the production transfer to Bantam, inventory reduction and foreign exchange conversions combined to depress the company's operating profit excluding non-recurring items to €8.1 million from €10.6 million a year ago. Net earnings declined to €6.6 million from €7.5 million. As a result, the comparable operating margin declined to 10.8 percent of sales from 14.4 percent.
