The New Wave Group, the Swedish company behind Craft, posted a 12th consecutive quarter of growth, with sales for the three months ended June 30, 2017 jumping by 9 percent to 1,372 million Swedish kronor (€143.8m-$169.1m), or by 5 percent excluding currency fluctuations. Operating profit rose by 10.0 percent over the year-ago quarter to SEK 110.5 million (€11.6m-$13.6m).
The company said it was encouraged by the rising profitability considering its substantial investment spend on both new products and marketing. It was also pleased by the sales result, especially because Easter was in the second quarter this year, which it said could have had a detrimental effect on turnover.
In the sports and leisure division, the group's sales increased by 6 percent. There was an improvement in both sales channels, mainly in the regions of Sweden and the rest of Europe. Along with Craft, the division includes the Seger, Cutter & Buck and Ahead brands, and the distribution of Speedo in Scandinavia, among other brands and activities.
In the Corporate Promo division, revenues increased by 12 percent, with higher sales across all regions. And in the Gifts & Home Furnishing segment, sales were up by 8 percent.
The group's total turnover in Sweden increased by 6 percent, boosted by the company's own retail operations. Sales in the U.S. advanced by 7 percent, aided by favorable foreign exchange rates. Other Nordic countries increased their sales by 2 percent, while revenues in Central and Southern Europe rose by 5 percent and 15 percent respectively. Revenues from other countries jumped by 46 percent, boosted by operations in Asia and the sales channel promo.
Overall, New Wave's gross profit margin was up by 0.1 percentage point to 45.6 percent.
All regions and all segments have shown growth during the first half of the year, with sales gaining 10 percent and the operating profit soaring by 42 percent over the year-ago period. The group's operating margin thus rose by 1.3 percentage points to 5.8 percent.
Looking forward to the rest of the year, the group revealed that, at the end of August, it will open a new Canadian warehouse for Cutter & Buck and Clique. It has also made a decision on new warehouses in Germany and Belgium and the automation of its warehouse in Italy.
Meanwhile, Craft's new teamwear category is now starting to take off and the brand has signed up PEC Zwolle, the Finnish floorball association, the Warberg floorball club and the Lycurgus volleyball club, with additional clubs in the pipeline in Europe. In addition, Craft shoes will soon be out in the shops. The group will also be starting extensive marketing in the U.S. at the end of this year and in 2018.