Marimekko gets major profits boost ahead of SS18 Junya Watanabe collab
Marimekko may be quite low-key when it delivers its earnings announcements but the firm’s high-profile prints are clearly making an impact on consumers, despite the tough market out there and a few difficult years for the business.
The Finnish fashion-to-homewares company said Thursday that royalty income and strong retail sales led to a “good earnings trend” during the latest nine-month and Q3 periods.
The company is working hard to expand awareness of its offer in all areas and last month saw its prints on the runway in Paris for Junya Watanabe’s SS18 collection for Comme des Garçons.
So what happened in Q3? Not that sales themselves actually soared. They rose only 1% to €27.2m in the quarter, as higher royalties from a new Asia Pacific licensing deal kicked-in. And the company saw a “positive trend” in retail sales, especially in its domestic Finnish market.
But while revenue edged up only slightly, operating profit for the period rose almost 20% to €4.4m from €3.7m a year ago, again with those Apac royalties and Finnish retail sales being the reason. The relative sales margin also rose, even though a dip in wholesale business in its domestic market dented the profits figure.
CEO Tiina Alahuhta-Kasko, said Q3 was “strong” and with cash flow from operating activities also up, “this provides a good basis for proceeding with improvements.”
Sales in the first nine months of this year were also up 1%, to €72.5m, while operating profit came close to doubling, rising to €6m from €3.5m. This was due to the same positive trends seen in the latest quarter, while sales growth in Australia also helped.
But the company is still predicting overall sales for the year, and comparable operating profit, to be flat or only marginally higher at best.
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