Odd Molly International AB (publ)
PRESS RELEASE
Stockholm, Sweden, October 21, 2011Sales meet expectations and operations streamlined
January 1 – September 30, 2011
· Net sales amounted to SEK 259.4 million (299.5)
· The gross profit margin rose to 57.6 percent (57.2)
· Operating profit amounted to SEK 33.8 million (50.2), corresponding to an operating margin of 13.0 percent (16.8)
· Net profit was SEK 23.9 million (34.8)
· Earnings per share amounted to SEK 4.15 (6.05)
July 1 – September 30, 2011
· Net sales amounted to SEK 109.7 million (137.8)
· The gross profit margin rose to 58.4 percent (57.6)
· Operating profit was SEK 17.8 million (30.9), corresponding to an operating margin of 16.2 percent (22.4). Excluding one-off costs of SEK 4.2 million attributable to the shutdown of the U.S. store and discontinuation of the men’s collection, operating profit amounted to SEK 22.0 million, corresponding to an operating margin of 20.0 percent
· Net profit was SEK 13.3 million (22.4)
· Earnings per share amounted to SEK 2.30 (3.90)
Events during the quarter
· Odd Molly opened its own web shop
· The order value for spring/summer 2012 amounted to SEK 114 million (165)
· Odd Molly’s spring and summer 2012 collection was presented at a fashion show at Berns during Stockholm Fashion Week
· Odd Molly streamlines its operations and focuses on the women’s collection and strategic markets:
-The store in Los Angeles is being closed and the U.S. operations restructured
-The separate men’s collection, Post fire dew, has been discontinued
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CEO’s comment
Sales during the third quarter amounted to SEK 110 million, in line with the reported order value. This fall’s main collection went out in stores during the quarter, while the large part of the pre-fall collection was delivered in the previous quarter. The gross profit margin remained at a stable, high level of 58.3 percent. Quarterly operating profit was charged with one-off costs of approximately SEK 4.2 million attributable to the discontinuation of the men’s collection, Post fire dew, and the closure of the store in Los Angeles. Adjusted for these costs, we delivered an operating margin of 20.0 percent for the quarter.
The order value for Odd Molly’s spring and summer 2012 collections was reported in early October at approximately SEK 114 million, a decrease of 31 percent compared with the same collections in 2011. The outcome was lower than expected and undoubtedly a sign that weak consumer spending and economic uncertainty in several of our most important markets have affected Odd Molly’s buyers.
In connection with the report on the weaker order value, the Board of Directors made a number of decisions to strengthen the prospects of future profitability and growth. Among other things, the operations in the U.S. are being reevaluated and the store in Los Angeles was closed as of October. The store space is being sublet, which will cover part of our rent through the remainder of the lease. Moreover, the separate men’s collection, Post fire dew, is being discontinued after it failed to meet our goals. As a whole, these decisions are expected to reduce costs by about SEK 10 million on an annual basis as of 2012, after all the closure costs are booked during the third quarter 2011.
The purpose of these measures is to enable the organization to fully focus on developing the core business – the women’s collection – and the company’s main markets, i.e., where we have the greatest potential for strong future development.
As Odd Molly closes its accounts for the period, I am also marking a conclusion of my own. This is my last interim report as CEO after seven years with the company. I am proud of the journey Odd Molly has taken, which has included major investments and a number of bold decisions. I am convinced that the changes now being implemented will lead the company and the brand to further success.
Christina Tillman, Chief Executive Officer
Please find the full report in the attached pdf file. For further information, please contact:
Christina Tillman, CEO of Odd Molly, phone: +46-8-522 28 502 or mobile: +46-733-10 60 00
About Odd Molly
Odd Molly is a Swedish company that designs, markets and sells fashion. Odd Molly products are sold through 1,300 retailers in around 40 countries around the world. In addition, Odd Molly currently has two concept stores in Stockholm and Copenhagen as well as two outlets in Kungsbacka and Barkaby. Odd Molly has 60 employees. The company’s profitable growth is the result of creative design, consistent branding and a business model that facilitates expansion with limited capital requirements and minimal inventory risk. Odd Molly’s share is traded as of June 21, 2010 on NASDAQ OMX Stockholm.
Scheduled information dates
-The year-end for 2011 will be released on February 17, 2012
-The order value for the second half of 2012 (fall and winter collections) will be announced on April 4, 2012
-The Annual General Meeting will be held at Södra Teatern in Stockholm at 2:00 pm on Thursday, April 26, 2012.
The information in this press release has been published by Odd Molly International AB (publ) on October 21, 2011 at 8.00 am CET in accordance with the Securities Market Act and/or the Financial Instruments Trading Act.
Odd Molly International AB
Kornhamnstorg 6
SE-111 27 STOCKHOLM
Sweden
Phone: +46 8 522 28 500
www.oddmolly.com (http://www.oddmolly.com/)
Press photos can be downloaded from Odd Molly’s website at www.oddmolly.com under “press”. Odd Molly also produces a newsletter, which reports on its day-to-day operations. To subscribe, go to www.oddmolly.com and click “sign up for our newsletter.”