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Björn Borg posts 23 percent jump in Q2 net sales

By Prachi Singh

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Business

The Björn Borg Group’s net sales amounted to 122.2 million Swedish krona (14.62 million dollars) in the second quarter, an increase of 23.2 percent. Excluding currency effects, sales increased by 24.8 percent. In the first half, the Group’s net sales amounted to 280.2 million Swedish krona (33.51 million dollars), an increase of 21.7 percent. Excluding currency effects, sales rose by 22.4 percent.

“During the quarter we strengthened our position as planned in sports and sports apparel, especially in our male target market. In one of our consumer surveys, 25 percent of respondents said they would buy athletic apparel from us, and in both the Netherlands and Norway we ranked fourth among men. We succeeded at the same time in maintaining our strong position in men’s underwear, where we remain number 1 in all our priority markets,” said CEO Henrik Bunge.

Reports sales rise across product categories

Sales improved in the second quarter, mainly of underwear, though footwear also performed well. As a result, brand sales excluding VAT rose by 14 percent to 281 million Swedish kroon (33.6 million dollars). Adjusted for currency effects, brand sales increased by 16 percent for the quarter. For the first half, brand sales increased to 700 million Swedish krona (83.7 million dollars), up 9 percent. Excluding currency effects, sales rose by 11 percent.

Brand sales in the underwear product area improved by 17 percent in the first half, while sports apparel saw a drop in brand sales of 6 percent. Brand sales rose in the footwear product area, but fell for bags, eyewear and fragrances. In total, sales of licensed products rose by 1 percent in the first quarter.

Among large markets, every country except Norway reported growth. Sweden, the Netherlands and England noted the highest growth in the first half, though Denmark, Finland and Belgium also performed well. Smaller markets continue to decrease year-on-year. One new Björn Borg was opened in Norway in the second quarter, while one closed in Belgium. As of June 30, 2016 there were a total of 40 Björn Borg stores, of which 21 were Group-owned.

Other financial highlights

Earnings per share in the second quarter before dilution amounted to 0.09 Swedish krona (0.01 dollar) and earnings per share after dilution amounted to 0.08 Swedish krona (0.01 dollar). For the first half, earnings per share before dilution amounted to 0.20 Swedish krona (0.02 dollar) and earnings per share after dilution amounted to 0.20 Swedish krona (0.02 dollar).

The gross profit margin for the second quarter was slightly better than the previous year at 53.5 percent but decreased to 51.5 percent in the first half against 53.4 percent last year. The company said, year-on-year decrease in the gross profit margin is due to increased price pressure in the market and a change in the distribution mix at the wholesale level.

Picture:Facebook/Björn Borg

Bjorn Borg