Rapala hopes to ‘Finnish’ strong for second half of year
Tackle titan Rapala has reported a one per cent reduction in net sales for the first half of 2019 but is aiming for a strong year-end.
Its sales at the halfway point of 2019 sit at €141.2m, compared with €142.5m in 2018. The company’s operating profit dropped by 25 per cent to €11.4m compared to the 2018 figure of €15.3m.
Rapala’s president and CEO Jussi Ristimäki said, “Our top line for the first six months developed for the most part according to expectations. However, some of the sales in North America will be shifted from the first half to the second half of the year and ‘third party products’ sales declined in the Nordics and western European countries.
“Consequently our net sales decreased by one per cent from last year. The positive highlights for the first half of the year were good sales development in winter sports business as well as growing sales and profitability in Russia, after many years of turmoil in the market. Furthermore, cash flow from operations increased from the previous year as a result of increased focus on working capital management.
“We keep our guidance unchanged for the full year 2019 and expect to increase comparable operating profit from last year. Our position with major customers in North America remains strong and we have solid underlying consumer demand and record strong order book for our products in the market. Increased profitability for the second half of the year will be driven mostly by postponed sales to certain key accounts as well as better profitability from the lure factory in Indonesia.
“Execution of our strategy of improving profitability, lightening balance sheet and improving operational performance is continuing and will be intensified during the second half of the year to get us back on the growth track.
“Other contributing factors include uncertainties and risks related to US/China trade relations, global economic growth, Shimano sales after changes in distribution agreements and retail customers’ year-end purchase behaviour.”