- Prachi Singh |
Kappahl's net sales for the quarter were 1,248 million Swedish krona (155 million dollars), flat on the last comparable fourth quarter. The company said, this is explained by negative effect of new and closed stores of 0.6 percent; 0.5 percent drop in comparable store sales, and currency translation differences totalling 1 percent. Kappahl's net sales were 4,916 million Swedish krona (612 million dollars) for the full year, an increase of 4.1 per cent compared with the previous year. This, the company said, is explained by the effect of new and closed stores, 0.5 percent; change in comparable stores of 1.6 percent and currency translation differences of 2 percent.
Commenting on the company’s annual trading, Kappahl President and CEO Danny Feltmann said in a media statement: “In the fourth quarter the market was characterised by an increasing number of aggressive offers, creating tough competition. The 2016/2017 financial year was yet another step towards Kappahl’s financial targets – to achieve an operating margin of 10 percent and a sales increase of 4 percent over a business cycle.”
Financial highlights of the Q4 results
Gross profit for the quarter was 757 million Swedish krona (81 million dollars) compared to 724 million Swedish krona (90 million dollars), corresponding to a gross margin of 60.7 against 58 percent last year. The operating profit for the quarter was 139 million Swedish krona (17.3 million dollars) against 99 million Swedish krona (12.3 million dollars), equivalent to an operating margin of 11.1 percent compared to 7.9 percent last year. Net financial income was a negative 15 million Swedish krona (1.8 million dollars) against negative 4 million Swedish krona (0.5 million dollars) for the quarter last year.
Profit before tax rose to 124 million Swedish krona (15. 4 million dollars) and profit after tax was 141 million Swedish krona (17.5 million dollars). EPS for the quarter were 1.84 Swedish krona (0.23 dollar) compared to 0.77 Swedish krona, (0.10 dollar) last year.
Parent company net sales for the quarter were 10 million Swedish krona (1.2 million dollars) and profit before tax was negative 447 million Swedish krona (55 million dollars) against 15 million Swedish krona (1.8 million dollars) last year since impairment losses of 461 million Swedish krona (57 million dollars) on investments in subsidiaries were recognised.
At the close of the period the total number of stores was 356 compared to 368 stores last year. Of these, 179 were in Sweden, 96 in Norway, 59 in Finland and 22 in Poland. One store was opened during the quarter and two were closed.
Review of Kappahl’s full-year results
Gross profit for the full year rose to 3,056 million Swedish krona (380 million dollars), corresponding to a gross margin of 62.2 percent. The operating profit was 448 million Swedish krona (55 million dollars), equivalent to an operating margin of 9.1 percent.
Profit before tax was 427 million Swedish krona (53 million dollars) and profit after tax was 364 million Swedish krona (45 million dollars). Earnings per share for the full year increased to 4.74 Swedish krona (0.59 dollar).
Parent company’s net sales for the full year were 30 million Swedish krona (3.7 million dollars) and the pre-tax profit was negative 415 million Swedish krona (51 million dollars) due to impairment losses of 461 million Swedish kroan (57 million dollars)on shares in subsidiaries.