Head NV H1 sales up 12.1 percent

Head NV, a global manufacturer and marketer of sports equipment, announced its

net sales for the first half of 2012 were up 12.1 percent compared to the same period the prior year. The first quarter net sales were 6.9 percent.

At constant currency, sales for the first six months were up 8.9 percent compared to the first half of 2011. Winter sports sales were ahead of the comparable period in 2011 by 2.6 percent. Sale at some international retail was low due to the very mild winter and late snow in both Europe and North America reducing pre-season orders by 20 percent to 25 percent. The Amsterdam-based company had record sales (21.3 percent) in the racquet sports market in North America in the first quarter but slowed in the second to 9.9 percent. The overall growth for the first half of the year was 15.7 percent.

Diving sales for the first half of 2012 grew by 6.7 percent due to market growth in North America and Asia. Sportswear sales for the six months improved by 1.0 millions euro’s (1.2 million dollars), or 42.4 percent, due to higher sales of summer sportswear. Gross margins for the six months to June 30, 2012 have declined from 41 percent to 39.9 percent due to higher cost of sales driven in part by lower utilization of the company’s alpine production facilities, increased labor rates and further investment in the sportswear division.

As a result of the foregoing factors, for the six months ended June 30, 2012, the company had a net loss of 10.1 millions euro’s (12.4 million dollars) compared to 13 million euro’s (16million dollars) the prior year. Net debt increased by 9.3 millions euro’s (11.5 million dollars) from June 30, 2011 to June 30, 2012 due mainly to higher working capital needs.