Nicolas Warchalowski, who left as chief executive of Haglöfs a few weeks ago after five years with the company, which is now a property of Asics, has been appointed CEO of Peak Performance. His career includes brand-building experiences at Procter & Gamble and Red Bull in the U.S. and Austria.
Warchalowski takes the place of Anders Cleemann, who has left the brand after a little less than a year at its head. Cleemann is also leaving the Danish-based parent company of Peak Performance, IC Companys, where he previously served on its executive board and was responsible for two other brands of the group.
Under Cleemann, Peak Performance has been repositioning its brand image based on its original concept of functional clothing with a modern look, combining fashion and function. It has also been closing some of its stores and opening new ones. The most recent addition is a 200-square-meter unit in the biggest shopping district of Gothenburg.
The brand will implement an e-commerce platform in the new financial year. It already has about 80 branded stores, half of which are franchised. It also sells to 2,031 wholesale customers which manage 2,117 points of sale.
The brand has been enjoying some success lately with its running and golf collections. The number of retailers carrying Peak Performance golf styles has increased to around 90 stores throughout Sweden.
IC Companys has reported relatively stable results for Peak Performance in the financial year ended last June 30. The brand's revenues were largely stable at 930 million Danish kroner (€124.89m-$161.77m), compared with DKK 931 million in the previous year, with strong sales at wholesale in spite of the termination of an agreement with a large unnamed Swedish client. The brand's retail sales declined by 7 percent, however, with a 1.5 percent drop on a same-store basis, due to store closures and the warm winter weather in the Nordic countries. The operating margin (Ebit) remained basically unchanged at 7.2 percent of sales, compared with 7.3 percent, thanks to better gross margins.
The brand fell in the Nordic countries but went up in other European countries, especially in the Alps. IC Companys describes Peak Performance as the biggest brand of technical sports and fashion wear in Scandinavia. The Nordic countries represented 65 percent of its total revenues in the past year, and the rest of Europe 31 percent.
The group's total revenues from continuing operations increased by 6 percent to DKK 2,563 million (€344.20m-$445.83m) in the past year, in spite of a negative currency effect of DKK 59 million (€7.92m-$10.26m). The gross margin improved by 0.7 percentage points to 57.3 percent and operating earnings (Ebit) rose by 16 percent, resulting in an Ebit margin of 8.6 percent compared with 7.9 percent the year before. Net profits from continued operations increased to DKK 159.7 million (€21.45m-$27.78m) from DKK 138.2 million. Counting in the losses from discontinued operations, the progress was much better.
In the fourth quarter, revenues were up by 5 percent to DKK 468 million (€62.85m-$81.41m), driven by Tiger of Sweden and By Marlene Birger, and operating losses declined, resulting in a negative Ebit margin of 6.9 percent against 9.4 percent in the year-ago period.
The management expects group revenues to continue to grow, delivering improved results from its premium brands, including Peak Performance.
Following the group's recent decision to divest its Mid-Market division, shareholders decided to vote for a change in its name from IC Companys to IC Group at the annual meeting held on Sept. 24.