Clas Ohlson Q1; plans autumn Amazon UK launch

Clas Ohlson has reported on first quarter 2018/2019 trading, covering the three-month period ending 31st July 2018, advising of  'stable underlying earnings in a challenging market climate'.

Highlights:

• Sales increased by 10% to 1,958 MSEK (1,783), organic sales up 6% and up 3% in comparable units
• Online initiative yields results — sales growth totalled 60%
• sCORE business system implemented
• Strategy implemented in the CO100+ action programme, except from ongoing growth initiatives, efficiency improvement measures of 200–250 MSEK identified so far
• Operating profit, including non-recurring items and costs linked to CO100+ action programme, totalling 32 MSEK (100)
• Underlying operating profit amounted to 62 MSEK (100)
• Profit after tax totalled 30 MSEK (77)
• Earnings per share amounted to 0.47 SEK (1.22)
• Pär Christiansen took office as CFO on 1 July 2018

Events after the end of the reporting period:

• Sales in August increased by 8% to 725 MSEK (671), organic sales up 4%
• As previously communicated, operating margin for the current and next full-year are estimated to be about 4 – 6% 

Notable excerpts from report:

After the positive reception of the Click & Collect concept in Norway, we are now launching this convenient solution in 92 Swedish stores. With that, Click & Collect will have been introduced across our entire Nordic home market. Through collaboration with Klarna, we have simplified check-out for our online customers.

More in-depth collaboration increases availability for our customers
We have initiated a number of strategic collaborations to provide customers with better availability and more complete offerings. In August we expanded our partnership with MatHem when the product range was increased from 700 to 2,000 products. 

We see great potential for growth in ‘non-food’ products online, which will be an important part of our aggressive growth goal of doubling our online sales every other year.

“Hemma hos” in Oslo, which opened in June, is the first Clas Ohlson store where customers can experience parts of our product range in a home-like environment. 

This autumn, Clas Ohlson will initiate a collaboration with Amazon in which we use its platform to offer our products to customers in the UK.

Lotta Lyrå, President and CEO of Clas Ohlson AB, said: 

"We have continued to implement our new strategy at a fast pace, and the initiative for profitable growth is being carried out according to plan. We are gradually beginning to see the positive effects of our work, which strengthens our conviction that we are on the right path.

"In addition to continued stiff competition for our customers’ wallets, the summer weather was a challenge for the retail sector in general. Clas Ohlson’s strength is in its relevant product range both for different weather conditions and over time. Compared with the end of the fourth quarter, our levels of stock have decreased by approximately 100 MSEK.

"The quarter’s commercial investments drive traffic to our stores and online, which generates increased sales per customer and square metre both now and over time. In addition, we are increasing the turnover rate in our product range, and in particular further strengthening our position in our broad customer base prior to the Christmas shopping season. For the quarter, we delivered a stable underlying operating profit of 62 MSEK (100)."

Click here to read the full release.

Source : Clas Ohlson Press Release

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