IC Companys’ Q3 gross profit down by 3.1 percent

IC Companys’ gross profit in the third quarter declined by 3.1

percentage points compared to last financial year. The interim report for Q3 reported a solid cash flow despite challenging market conditions.

Gross profit amounted to DKK 568 million (DKK 638 million for the third quarter last year). The group thus generated a gross margin of 54.9% compaired to 58% for the same quarter last year, corresponding to a decline of 3.1 percentage points compared to the last financial year. The group expected consolidated revenue of DKK 1,035 million for Q3 2011/12 corresponding to a reduction of 6% compared to last financial year. The structural changes last implemented by the group started to have an impact and costs were reduced by 5%. Operating profit amounted to DKK 56 million corresponding to a decrease of 45%. Efficient price campaigns and sales promoting activities resulted in the group being able to retain its market position and generate a solid cash flow but did at the same time exert a continuous pressure on the group's gross margin which suffered a decline of 3.1 percentage points.

Wholesale revenue amounted to DKK 694 million (DKK 748 million for the same quarter last year) corresponding to a 7% setback. Retail revenue amounted to DKK 341 million (DKK 352 million for the same quarter last year) corresponding to a 3% setback. Capacity costs amounted to DKK 512 million (DKK 537 million for the same quarter last year) corresponding to a reduction of 5%. The cost rate for Q3 2011/12 thus amounted to 49.5% (48.8% for the same quarter last year) which is an increase of 0.7 percentage points compared to last financial year. Operating profit amounted to DKK 56 million (DKK 101 million for the same quarter last year). The group thus generated an EBIT margin of 5.4% (9.1% for the same quarter last year). Total cash flow from operating and investing activities amounted to an outflow of DKK 34 million (outflow of DKK 136 million for the same quarter last year) corresponding to an improvement of DKK 102 million compared to last financial year. Order intake for the autumn collection 2012 is expected to record a setback of 12% reported in local currencies.

IC Companys A/S is a Danish listed group formed in 2001. It has a portfolio of 11 brands like Peak Performance, Tiger of Sweden, Jackpot, InWear, Matinique, Saint Tropez, Part Two, Cottonfield, By Malene Birger, Soaked in Luxury and Designers Remix. These brands are sold through nearly 500 retail and franchise stores, through e-commerce and via close to 10,000 distributors in more than 40 countries.