Continued double-digit growth at Ortovox and a slight increase at Gonso were insufficient to compensate for sales declines at Deuter and Maier Sports during the financial year ended on June 30. As a result, the Outdoor division of the Schwan-Stabilo group saw its total revenues fall slightly by 0.6 percent to €168.3 million.
The company attributed the relatively poor results to a challenging environment in Europe, the U.S., South Korea and Japan. It recalled the fact that sales of outdoor products declined for the first time last year in Europe in all four main categories. According to the European Outdoor Group, for example, sales to the trade fell by 0.8 percent in the apparel segment and by 2.6 percent for backpacks and luggage.
While claiming that Deuter remained the European leader in the core segment of high-end, functional backpacks, the group indicated that it lost market share as a mountaineering-oriented brand. Besides the previously reported transition from a distributor to a subsidiary in China, where the market is growing, Schwan-Stabilo explained Deuter's lower turnover with a flagging retail sector and increased competition, especially in the hiking and cycling segments, as well as in the more fashionable segment of daypacks.
Martin Riebel, managing director of Schwan-Stabilo's Outdoor division, said that Deuter will again focus more on its leadership in function and comfort. It will put out new models with recycled materials and a distinctive design, providing customers with greater freedom of choice through a combination of specialist retailing and the brand's new web store.
Riebel attributed Ortovox' strong performance to its consistent positioning as a mountaineering brand for summer and winter sports such as climbing, ski touring and freeriding, plus the use of sustainable materials and the brand's stress on mountain safety.
The main reason given for the slight decline at Maier Sports last year was that it put an end to its former private label business. Schwan-Stabilo pointed out that Maier has established a reputation for functional hiking trousers, featuring 61 sizes for all body types, and that it got an “Outdoor Brand of the Year” award from Germany's Outdoor Markt magazine.
Meanwhile, Gonso benefited from the completion of a strategic realignment, focusing on cycling shorts with a wide range of sizes and a meticulous selection of materials.
No specific figures were given for the individual brands. As previously reported, the group opened a new office for the Chinese market in July. Deuter started to work with Tmall, and according to a report, it sold as much merchandise on Singles Day on its platform as during the whole month of October. On the other hand, Deuter lost about half of its volume in South Korea, and the U.S. embargo on Iran cut its revenues by $1 million.
While declining slightly, the Outdoor division performed better in the last financial year than Schwan-Stabilo's bigger Cosmetics division, whose sales dropped by 7.4 percent, while the Writing Instruments division had an increase of 0.9 percent. As a group, Schwan-Stabilo booked a 3.3 percent sales decline to €662.5 million.
Schwan-Stabilo is still profitable, but the company's new management has reportedly decided to eliminate around 200 jobs at its head office following a drop of around 20 percent in its total turnover during the past two years. It is investing in e-commerce and other digital capabilities including a new ERP system.