Apart from the situation with exchange rates, outdoor companies in several European markets have been affected by the long winter, which has delayed sales of spring products. This was the case for Haglöfs, the Swedish company that has just been acquired by Asics.
However, Haglöfs’ managers have told us that the company was on track to end the year with yet another robust sales increase, well ahead of expectations, after an average compound annual growth of 17 percent over the past four years.
Haglöfs reported a sales decline of 1.0 percent to 163.0 million Swedish kronor (€17.2m-$22.2m) for the first quarter, translating to an increase of 6 percent in constant currencies. The slide was attributed chiefly to a shift in deliveries: While re-orders of winter products inflated Haglöfs’ sales in the fourth quarter of 2009, delayed deliveries of spring products depressed its sales in the first quarter of this year.
The brand’s turnover declined by 3.5 percent in the Nordic region but inched up by 2.5 percent in other markets. Apparel sales went up by 1.6 percent to 123.6 million SEK (€13.1m-$16.8m) and footwear sales jumped by 8.5 percent to 14.1 million SEK (€1.5m-$1.9m). However, equipment sales were down by 15.4 percent to 25.3 million SEK (€2.7m-$3.4m), which was blamed on postponed sales in the Nordic region as well as declining sales in Japan.
The sales decline was described as the sole cause for a very slight decline in Haglöfs’ gross profit for the quarter, amounting to an unchanged gross margin of 37.4 percent. The Swedish company’s operating profit was also affected by a small increase in overhead, so that its operating margin ended at 11.5 percent, compared with 12.5 percent for the same quarter last year. It achieved a net profit of 13.6 million SEK (€1.4m-$1.8m) for the three months, down marginally from 13.8 million SEK in the same period a year ago.