The Lafuma Group reported a quantum improvement in the financial year ended Dec. 31, posting a net profit of €2,270,000 for the period against a net loss of €69,196,000 in the comparable 12-month period through December 2013. It booked ordinary operating earnings of €3,039,000 versus an operating loss of €4,233,000. The year-earlier figures were stated on a pro-forma basis as the company's fiscal year previously ended on Sept. 30.
The positive results were the fruit of a reorganization of the French group and its elimination of loss-making activities under the ownership of the Swiss-based Calida Group. As previously reported, the new policy has led Lafuma to record a drop in total revenues to €172.1 million for the year, down from $193.6 million in 2013.
All the product segments of the group were profitable at the operating level in 2014. The Mountain segment, which represented 62 percent of group sales, saw its revenues decline by €12.6 million, following a repositioning of the Lafuma brand. It generated a profit due to the solid performance of the Millet and Eider brands.
The camping furniture business of Lafuma delivered strong profit margins. Even the surf segment, represented by Oxbow, became profitable in spite of a 23 percent drop in its sales. The refinancing process conducted by Calida last year led Lafuma to improve its balance sheet, ending up with a 49.8 percent equity/debt ratio.
The company predicts that its sales will decline in 2015 due to strong competition and weak market growth, especially in Europe. The weakness of the euro should lead to a slight drop in profits if it persists.
Conversely, much lower operating results are expected by the Calida group because of the appreciation of the Swiss franc, the weakness of the euro and the weak economy in Southern Europe. The acquisition of Lafuma caused Calida to boost its total revenues by 99.8 percent to 412.8 million Swiss francs (€391.3m-$418.1m). Sales remained flat for its its Calida brand, and they went down slightly for its other brand of lingerie, Aubade.
The Swiss group's operating profit (Ebit) after extraordinary items rose by 29.5 percent to CHF 27.2 million (€25.8m-$27.6m) and its net income increased to CHF 23.6 million (€22.4m-$23.9m) and its equity ratio improved to 53.8 percent.