IC Companys – Annual Report 2008/09 0 - IC Companys A/S

The development in Norway was generally positive.
Admittedly, revenue reported a slight decline, but
this was attributable to an exchange rate effect. Taking
this into account, Norway reported an underlying
growth of 3%.
Order intake
Order intake for the winter collection 2009 was
completed recording a decline of 18% in local cur-
Distribution channels
rencies. Translated into the reporting currency, the
result is a setback of 24%. This is attributable chiefly
to more cautious buying on part of individual third
party retailers, but also, that a number of third party
retailers are discontinued as a result of the economic
crisis. The winter and autumn collections
combined reported a 17% setback in local currencies
and 21% in the reporting currency.
Wholesale Retail Outlet Group
DKK million 2008/09 2007/08 2008/09 2007/08 2008/09 2007/08 2008/09 2007/08
Net revenue 2,357 2,497 1,080 1,092 163 148 3,601 3,737
Growth -6% -1% 10% -4%
Profit 326 419 (27) 78 (2) 21 296 518
Profit margin 13.8% 16.8% -2.5% 7.2% -1.3% 14.1% 8.2% 13.9%
Un-allocated shared costs* (135) (169)
Operating profit 162 349
EBIT margin 4.5% 9.3%
* Un-allocated costs comprise IT,I Finance, HR group management
Wholesale operation
In the financial year 2008/09 wholesale revenue
reported DKK 2,357 million (DKK 2,497 million)
which constitutes a 6% decline. Preorder revenue
fell by 5% and in-season sales saw a decline of 7%.
This includes franchise revenue, which recorded a
1% growth relative to last year. The total number of
sales points as at 30 June 2009 is 10,800 against
12,000 as at 30 June 2008
The distribution channel profit of the wholesale operation
saw a 22% decrease to DKK 326 million
(DKK 419 million) which corresponds to a distribution
channel profit margin of 13.8% (16.8%). The
decrease of relative earnings is mainly attributable
to discounts and returns, which reduced the profit
margin by 2.2 percentage points. In addition, the
impact from declining volume relative to cost base
should also be taken into account.
In the course of the fourth quarter of the financial
year 2008/09, the Group saw a net franchise store
outflux of 8 and is thus servicing 144 franchise
stores.
IC Companys – Annual Report 2008/09
Retail operation
Full year 2008/09 retail revenue came in at DKK
1,080 million (DKK 1,092 million) which constitutes
a downward movement of 1%. As a result of net store
openings and expansions, revenue is positively
affected by DKK 66 million. The development in
same-store sales reported a 7% setback in the financial
year 2008/09, whereas the fourth quarter
alone accounts for an 11% decline.
In the financial year 2008/09, retail profit recorded
a loss of DKK 27 million (surplus DKK 78 million).
The negative development is ascribable to a lower
retail gross margin realised in 2008/09 as a result
of increased sale activities measured against last
year.
Over the course of the financial year, the Group opened
113 new stores and closed 46 stores. The major
part of the newly opened stores is retail concessions.
In China, all 40 stores were closed. Combined this
constitutes a net store influx of 2,400 square metres.
This brings the Group’s total retail operations to
39,800 square metres distributed between 304
stores.
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