Release Date: August 15, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Net sales increased by 8% in Q2, totaling EUR 43.7 million.
- International sales grew by 6%, with significant growth in the Asia Pacific region.
- Omnichannel retail sales grew in all market areas.
- Cash flow from operating activities increased significantly.
- Strong financial position despite weaker general market conditions.
Negative Points
- Operating profit was slightly behind the comparison period.
- Licensing income was significantly lower than in the comparison period due to seasonal variation.
- Higher fixed costs due to marketing investments and personnel expenses.
- Relative sales margin weakened by higher discounts and increased logistic costs.
- Wholesale sales in the EMEA region decreased.
Q & A Highlights
Q: Can you explain the reasons behind the 1% growth in wholesale sales in the Asia Pacific region for the second quarter?
A: Tiina Alahuhta-Kasko, CEO: The cumulative growth in wholesale sales in the Asia Pacific region was 9.9%, with net sales growing by 11% in the first six months. The second-quarter growth was negatively impacted by timing issues between quarters and significantly lower licensing income, which is a seasonal variation. We expect licensing income to be approximately at last year's record level by year-end.
Q: How do you see international sales growth in the second half of the year?
A: Tiina Alahuhta-Kasko, CEO: We estimate our international net sales to grow, particularly in our key markets, Finland and the Asia-Pacific region. We are leveraging the Unikko anniversary and brand marketing investments to capture more momentum and support long-term growth, especially in international markets.
Q: Could you elaborate on the pop-up stores in Japan during Q2?
A: Tiina Alahuhta-Kasko, CEO: The pop-up stores in Japan were set up to celebrate the 60th anniversary of Unikko. These pop-ups varied in duration, from a week to several weeks, and were very visible across the country. We also had pop-ups in Australia in the first quarter and have plans for more throughout the year.
Q: What were the main reasons for the increase in fixed costs in Q2?
A: Elina Nckar, CFO: The higher fixed costs were primarily due to planned investments for the 60th anniversary of the Unikko print and general pay increases. These investments are crucial for our long-term growth and competitiveness, especially in international markets.
Q: Can you quantify the impact of lower licensing income on the relative sales margin?
A: Elina Nckar, CFO: Licensing income is very profitable and its reduction significantly impacted the relative sales margin. We ensure that the biggest reasons for changes are always highlighted first in our reports.
Q: How is the Finnish retail market developing, and are there any differences between Q1 and Q2?
A: Tiina Alahuhta-Kasko, CEO: The general sentiment in Finland remains weak, although there are some positive signs in statistics. Despite this, Marimekko's sales in Finland grew by 11% in Q2, with omnichannel retail sales increasing by 5%. We aim for continued profitable growth regardless of the market sentiment.
Q: Is there potential for a men's collection at Marimekko?
A: Tiina Alahuhta-Kasko, CEO: We have a unisex collection called Marimekko Kiosk, which caters to the male audience. Recently, we introduced our first-ever Marimekko denim collection, which includes unisex products that embody the Marimekko DNA.
Q: What are the recent developments in Marimekko's digital transformation?
A: Tiina Alahuhta-Kasko, CEO: In 2024, we opened a new online platform in China and launched Marimekko online stores in Malaysia, Vietnam, and Singapore. Digital plays a crucial role in our omnichannel strategy, and we continue to evolve our online and offline integration to enhance the customer experience.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
