- Prachi Singh |
Net sales for the third quarter grew by 10 percent to 29.8 million euros (34 million dollars) at Marimekko, which the company said, was generated primarily by retail and wholesale sales in Finland and by wholesale sales in the Asia-Pacific region. Operating profit for the quarter grew to 6.2 million euros (7 million dollars) compared to 4.4 million euros (5 million dollars), while comparable operating profit was 6.3 million euros (7.1 million dollars). The company added that earnings were boosted by growth in net sales, increase in relative sales margin and reduced depreciation, however, a drag was exerted by lower royalties and higher fixed costs than in the comparison period.
Commenting on the results, Tiina Alahuhta-Kasko, the company’s President and CEO, said in a statement: “On 21 September 2018, we revised our estimate of full-year comparable operating profit. At the same juncture, we estimated that this year most of our earnings will, contrary to the normal situation, be generated during the second and third quarters. Our aim is to start online selling of Marimekko products so that we can, together with our local partner, offer our customers an omnichannel experience in the China market as well. Also, we must not forget the year’s most important season, holiday sales, the success of which in our sector typically has a vital impact on the full-year results.”
Marimekko net sales for the nine month period up 13 period
In the January-September period, net sales grew by 13 percent to 82.1 million euros (93.7 million dollars). In Finland, retail sales grew by 11 percent and wholesale sales by 26 percent. In the Asia-Pacific region, wholesale sales rose by 20 percent. Operating profit for the period improved to 16.5 million euros (18.8 million dollars) compared to 6 million euros (6.8 million dollars) last year with the capital gain from the sale of the company’s head office. Comparable operating profit was 10.6 million euros (12.1 million dollars).
Following the sale of Marimekko’s head office in spring 2018, which strengthened the company’s financial position the company’s board has decided that part of the funds will be used for development of strategically important business areas and that a proposal for the payment of an additional dividend of 1.25 euros (1.43 dollars) per share will be made to the annual general meeting to be held in spring 2019.
Marimekko reveals market outlook and growth targets for 2018
The company further said that uncertainty in the global economy is forecast to continue, partly because of the unpredictability of the political situation. Consumer demand forecasts vary among Marimekko’s different market areas. Finland, Marimekko’s important domestic market, represents about half of the company’s net sales. Growth in retail trade is forecast to be at a fairly good level.
The Asia-Pacific region, Marimekko’s second-biggest market, the company added, plays a significant part in the company’s internationalisation. Japan has a very comprehensive network of Marimekko stores, and new ones are being opened at a rate of a few stores per year. Sales in the Asia-Pacific region this year are forecast to grow. The company sees increasing demand for its products in this area especially in the longer term.
The company aims is to open around 10–15 new Marimekko stores and shop-in-shops and will continue the enhancement of the operations of Marimekko stores opened in recent years.