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Odd Molly International AB (publ)
Stockholm, Sweden, April 29, 2014
More stores and new sales organization
January 1- March 31, 2014
Net sales amounted to SEK 82.8 million (77.2).
The gross profit margin was 53.8 percent (53.6).
Operating profit amounted to SEK 3.5 million (1.6).
Net profit amounted to SEK 2.5 million (1.0).
Earnings per share before dilution amounted to SEK 0.44 (0.17).
Events during the quarter
In March Odd Molly reported an order value for the fall/winter 2014 collection of about SEK 121 million, compared with about SEK 95 million for the same collection in 2013.
During the quarter an Odd Molly store was opened through a retailer in Bromma Blocks, Stockholm, as well as two shop-in-shops, also through a retailer, at NK in Stockholm and Göteborg.
Decision was made to close the company’s own store in Copenhagen in September.
Events after the end of the quarter
Contract has been signed on a company-owned Odd Molly store in Väla Centrum, Helsingborg.
The web shop was opened to U.S. customers in April.
Comment from the CEO
The first quarter of the year developed according to expectations, in line with order values and a growing share of sales directly to consumers. Against this backdrop - and our intention to continue to invest strategically in our own sales channels - we are reporting sales in two separate segments beginning with this report: wholesale (to external retailers) and retail (to consumers through our own channels).
Our own sales to consumers are growing
The performance of our own channels continued to be positive during the quarter, especially for the web shop, which is growing strongly. We are reaching consumers throughout Europe and after Easter also launched the web shop in the U.S.
During the quarter we opened a store in Bromma Blocks and two shop-in-shops in the NK department stores in Stockholm and Göteborg, all of which will be managed by established retailers. After the end of the quarter we signed an agreement to open our own store at Väla, in Helsingborg, later this spring. Since we are not seeing any improvement in our store in Copenhagen, we have decided to close it in September. We will continue to look for interesting opportunities for our own stores, shop-in-shops or collaborations with major retailers.
Our own responsibility for sales to retailers is increasing
The first months of the year have been especially important and inspiring, since we marketed the collection in our largest market, Sweden, by ourselves for the first time after taking over sales responsibility from the previous agent. The work has been done in close cooperation, but now we have created a sales organization that will stand on its own and drive sales for Odd Molly. I am very pleased with the progress I have seen so far.
The order value for fall and winter 2014 was announced in March and showed an increase compared with the same collections in the previous year of 27 percent to about SEK 121 million. We have reduced our average prices, and average orders are increasing according to plan. Now we can focus even more on developing relationships with the right customers to increase sales going forward. We are very pleased - but humbled - by this positive development. One reason is the revised category strategy we fully launched a year ago, and another is that we are now handling a larger share of sales to both retailers and consumers ourselves. At the same time change is always associated with risk, as is also the case with this shift in responsibility, and I have full respect for the work our agents are doing and for the cautiousness that still exists in parts of Europe.
To strengthen our customer presence and improve precision in our ordering, we are now transitioning to four sales periods per year from two previously. This means that now in April we have already begun marketing the initial release of our spring and summer 2015 collection.
Karin Jimfelt-Ghatan has chosen to step down from her position with the company and will clearly be missed. With her distinctive designs, she helped to create a foundation for the successful concept Odd Molly is today. Under the circumstances, however, it is reassuring that we have worked hard in recent years to build a strong design team and appointed new leaders who are responsible for developing our collections.
After the major steps we have taken as a company, I feel the organization radiates a great deal of positive energy. We look forward to continued hard work and progress.
Anna Attemark, CEO
Please see the full report in the attached PDF file.