The Thule Group continued to improve its profitability in the third quarter to Sept. 30.
The company's operating income (Ebit) went up by 17.1 percent to 243 million Swedish kronor (€24.8m-$26.3m), raising the operating margin to 17.8 percent from 15.5 percent in the year-ago period. Even after currency adjustments, the underlying operating profit (Ebit) rose by 6.9 percent for the period, resulting in a margin improvement of 0.9 percentage points, thanks to higher sales, a better product mix and cost efficiencies.
On a rolling 12-month basis, the underlying Ebit margin reached 17.2 percent, up from 16.0 percent for the full 2015 calendar year. Net income went up by 9.4 percent to SEK 162 million (€16.3m-$18.0m).
The company's quarterly sales inched up by 1.7 percent to SEK 1,366 million (€137.4m-$152.3m), but they grew organically by 5.2 percent. The revenues of Thule's Other Outdoor & Bags segment rose by 2.4 percent to SEK 1,253 million (€128.0m-$135.8m), with an organic increase of 1.4 percent. The segment's underlying Ebit margin rose to 20.1 percent from 19.0 percent, with an increase of 0.4 percentage points in local currencies.
Outdoor & Bags comprises the company's relatively recent category of backpacks as well as equipment for cycling, water sports and winter sports; roof boxes and bike trailers; baby joggers; laptop and camera bags; and cases for mobile handheld devices.
The company's sales continued to fall in the Americas, declining by 8.8 percent in local currencies, due to an outdoor market weakened by retail bankruptcies and cautious buying by bike dealers. Thule's sales of bags for electronic devices continued to fall in the region.
They rose by 11.1 percent in local currencies in Europe and the rest of the world, driven by the company's Sport & Cargo Carriers and the Other Outdoor & Bags segment, particularly in the Active with Kids area, which includes sport strollers. Thule claims that its market shares continued to increase in both segments through successful launches of new backpacks and other products.
Other Outdoor & Bags generated a sales increase of 8.4 percent to SEK 842 million (€86.0m-$91.3m) in Europe and the rest of the world. The organic growth was limited to 7.4 percent excluding GMG, the leading supplier of child bike seats in the Benelux countries, which it acquired in early July in a debt-free deal worth €10.0 million.
The group is proceeding quickly with the integration of GMG, which has been trading under the Yepp brand name. At the bike fairs in September, the company launched a new line of child bike seats under the Thule Yepp brand. The assembly of GMG's products has been transferred to Thule's own facilities, and a new plant will be opened in Poland in the first quarter of 2018.