Swiss firm Fenix Outdoor's revenue at $176.7 mn in Q1 FY24

In terms of brand performance, all major markets experienced a slowing development, largely influenced by inventory challenges and cautious retail sentiments. However, there's a glimmer of optimism as direct-to-consumer sales across Europe, particularly through online channels, are on an upward trajectory, with Fjallraven emerging as a standout performer in this domain. Despite these positive indicators, external net sales for the Brands division decreased by 14.9 per cent to €45.2 million, with an operating profit of €12.9 million compared to €17.6 million in the prior year.

Similarly, within the global sales segment, there was a decrease in net sales from €58.7 million to €47.6 million, resulting in an operating profit of €7.8 million, down from €12.3 million in the previous year, the company said in a press release.

A closer look at sales channels reveals that brick-and-mortar outlets continue to outperform digital channels across the group, with the exception of brands. This trend is consistent with broader market dynamics, with digital sales accounting for 19.2 per cent of total sales in the quarter, compared to 16.8 per cent in Q1 FY23.

Turning to the Frilufts division, the Nordics experienced growth in Q1, buoyed by colder weather conditions. Conversely, Germany witnessed a relatively flat development, with brick-and-mortar sales surpassing digital channels yet again. In the UK, Trekit, primarily operating as a digital player, faced challenges but maintained profitability. Overall, net sales for Frilufts increased by 4.4 per cent to €71.1 million, with an operating profit of minus €7.3 million, an improvement from minus €8.6 million in the previous year, primarily driven by higher sales in Sweden.

Fenix Outdoor is beginning to assert better control over its inventory, which decreased by 4.9 per cent to €257.8 million from €271.1 million. This marks a significant milestone as the company has now reached its peak inventory level on a like-for-like basis.

“Looking forward at 2024, we are facing several challenges, but also possible opportunities. As I have mentioned earlier, we are facing a non-satisfactory inventory situation. However, we are now seeing the first signs of improvement both internally as well as at our retailers. On the retail side, there is still a high risk of discounting in the market to activate the large inventories on hand,” said Martin Nordin.

Fibre2Fashion News Desk (DP)