IC Group blames wholesale channel for first quarter sales slump
In the first quarter of the 2017-18 fiscal year, closed at the end of September, the revenue of IC Group, owner of Peak Performance, Tiger of Sweden and By Malene Birger, fell by 4.8% (4.4% in local currency), down to DKK810 million (approximately €109 million). The Scandinavian group's performance was affected by the negative results with multibrand retailers of its three leading brands.
In detail, mountain sport brand Peak Performance was relatively stable in the first quarter, losing only 0.6%, with a revenue of DKK346 million. The downturn was blamed on multibrand store sales, while direct retail sales grew. Operating income improved, growing from DKK62 million to DKK72 million, and EBIT was also up, from a 17.8% to a 20.8% margin.
Revenue for ready-to-wear labels Tiger of Sweden and By Malene Birger was more heavily affected, losing respectively 8% (down to DKK266 million) and 3% (down to DKK99 million). Once again, IC Group explained the shortfall as a result of weak autumn orders, especially in the case of Tiger of Sweden. However, womenswear label By Malene Birger doubled its operating income, reaching DKK8 million, after floundering in the same period of the previous year.
The fashion group's third brand segment, featuring Saint Tropez and Designers Remix, recorded the worst sales shortfall, losing 11.3%, for a revenue of DKK102 million. Its operating income plummeted to DKK3 million, losing 13%, while EBIT fell from 11.3% to 2.9%. The losses were chiefly due to the closing down of six stores for fast-fashion label Saint Tropez.
IC Group also stated that the sale of its tech sportswear brand Peak Performance, announced in early October, is still being evaluated.
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