Marimekko sees improving trend in third quarter
Finland’s Marimekko saw its sales and profits improving in Q3 as actions it had taken and better wholesale turnover fed through to the bottom line.
In the three months to September 30, net sales rose 10% to €38 million with “a favourable trend in wholesale in Finland and EMEA”. The increase in Finnish wholesale was partly due to non-recurring promotional deliveries.
But the firm’s retail sales “declined moderately considering the circumstances”, while online sales continued to perform well and retail sales in Finland remained on a par with the comparison period. Also, retail sales included about €1 million in sales that were left unrecognised as revenue in Q2 due to logistic challenges posed by the pandemic.
It all meant operating profit grew to €10.5 million from €7.8 million with earnings boosted by a noticeable fall in fixed costs as well as by the increased sales. Those fixed costs were helped by its own actions but also by government subsidies in various countries designed to mitigate the worst effects of the pandemic.
The company expects net sales for the year to be lower than in the previous year and comparable operating profit is estimated to be approximately at the same level as, or lower than, the year before.
President and CEO Tiina Alahuhta-Kasko said: “Wholesale sales and prompt adjustment measures helped Marimekko increase its net sales and improve its results in a challenging operating environment. Continued strong online sales supported retail sales as the pandemic kept affecting customer numbers of brick-and-mortar stores.
“The coronavirus pandemic continues to heavily impact the fashion industry and specialty retail sector across the world. In managing this exceptional crisis, in addition to an ability to react quickly and an internationally attractive and relevant brand, Marimekko’s strengths have been a comprehensive range of lifestyle products and a diverse business and distribution channel model.
“With the pandemic, consumers have become increasingly interested in home decoration, which has resulted in robust growth in sales of our home products. The relaxed feel of our ready-to-wear collection – now more evident than before – also appeals to consumers in these unusual circumstances. While the pandemic has understandably reduced footfall in retail stores, we have managed, to a large extent, to offset the decline in retail sales with online sales. We have also achieved strong growth in our wholesale sales.”
She added that the changes seen this year “will influence Marimekko’s distribution channel choices in the future”.
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