IC Group posts 4.8 percent revenue reduction in Q1

IC Group has announced that consolidated revenue for the first quarter of 2017/18 amounted to 810 million Danish krone (127 million dollars), a reduction of 4.8 percent or 4.4 percent in local currency. The company said, revenue decreased in the wholesale channel whereas the retail channel reported increased revenue driven by higher same-store revenue as well as the full-year effect from new stores. The gross margin amounted to 58.3 percent compared to 56.1 percent reported last financial year.

The consolidated operating profit amounted to 140 million Danish krone (21 million dollars) resulting in an EBIT margin of 17.3 percent compared to 15.9 percent for Q1 2016/17.

Segment performance for Q1

Peak Performance generated revenue of 346 million Danish krone (54 million dollars), a decrease of 0.6 percent. The retail channel reported a revenue increase. The operating profit amounted to 72 million Danish krone (11 million dollars) corresponding to an EBIT margin of 20.8 percent against 17.8 percent last year. The improved margin, the company said, is attributable to a higher gross margin.

Tiger of Sweden generated revenue of 266 million Danish krone (41 million dollars) corresponding to a decrease of 8 percent or 7.5 percent in local currency. Revenue from the wholesale channel, IC Group added, declined due to lower order intake on the autumn collections whereas revenue from the retail channel increased. The operating profit amounted to 47 million Danish krone (7.3 million dollars), and the EBIT margin declined to 17.7 percent due to a higher cost ratio.

By Malene Birger generated revenue of 96 million Danish krone (15 million dollars), a decline of 3 percent or 2.5 percent in local currency due to lower order intake whereas the retail revenue increased. The operating profit amounted to 8 million Danish krone (1.2 million dollars), and the EBIT margin improved to 8.3 percent due to a higher gross margin.

Revenue from the group's other brands decreased by 11.3 percent or 11.2 percent in local currency to 102 million Danish krone (16 million dollars) for Q1 2017/18 driven by Saint Tropez. The operating profit amounted to 3 million Danish krone (0.4 million dollars), an EBIT margin of 2.9 percent against 11.3 percent same quarter last year.

IC Group’s performance for Q1

The company’s consolidated revenue amounted to 810 million Danish krone (127 million dollars) corresponding to a reduction of 4.8 percent or 4.4 percent in local currency). The company said, this reduction was driven by the wholesale channel, in particular by Tiger of Sweden, whereas revenue from the retail channel increased as a consequence of higher revenue from physical stores, high e-commerce growth as well as the full-year effect from stores opened within the past twelve months.

During the quarter, the total number of stores was reduced by six primarily attributable to store closures in Saint Tropez. The gross profit amounted to 472 million Danish krona (74 million dollars) whereas the gross margin increased to 58.3 percent due to improved product margins as well as a larger share of sales through the company’s own channels.

The consolidated operating profit amounted to 140 million Danish krona (21 million dollars) corresponding to an EBIT margin of 17.3 percent compared to 15.9 percent for Q1 2016/17.

IC Group maintains outlook for FY17/18

For the group as a whole, IC Group expects to realize a minor revenue reduction compared to the financial year 2016/17 and an EBIT margin of approximately 5 percent.

A moderate revenue and earnings growth is expected in Peak Performance. In Tiger of Sweden revenue is expected to decline while earnings are expected to be significantly down compared to last financial year. The company expects a moderate revenue decline but significant earnings improvement in By Malene Birger.

As announced earlier, the company said, it continues with a strategic review process of Peak Performance.

Picture:Peak Performance website