REPORTING OF
OPERATING SEGMENTS
GIFTS & HOME FURNISHINGS
New Wave Group divides its operations into the segments
Corporate, Sports & Leisure and Gifts & Home Furnishings.
The Group monitors the segments’ and brands’ sales as well as
EBITDA. The operating segments are based on the Group's opera-
tional management.
Net sales during the second quarter increased by 5% to SEK 162.7
(154.7) million. Most of the improvement is related to Sweden and
the retail sales channel. EBITDA decreased slightly compared to
last year and amounted to SEK -1.9 (3.7) million, which is mainly
attributable to a lower gross profit margin. IFRS 16 had a positive
impact on EBITDA of SEK 2.0 million.
CORPORATE
Net sales during the second quarter increased by 7% to SEK 839.3
(783.4) million. Sales growth took place in the regions the USA,
Central and Southern Europe and Other countries. Sweden and
the other Nordic countries had slightly lower net sales than last
year. It was mainly the promo sales channel that increased its sales.
EBITDA increased by SEK 15.4 million and amounted to SEK
125.3 (109.9) million. The improved result is related to IFRS 16
and excluding the effects from the new accounting standard, the
result decreased slightly. This is due to higher costs in the form
of more sales and marketing activities and higher costs for dist-
ribution units. The cost increase for the distribution units was
related to larger premises as well as other improvement measures
to increase the service level. IFRS 16 had a positive impact on
EBITDA of SEK 20.1 million.
Net sales for the period January-June increased by 4% to SEK
287.2 (276.5) million. Sales increased in both sales channels.
The growth is mainly in Sweden. EBITDA decreased slightly
compared to last year and amounted to SEK -19.4 (-16.2) million,
which is attributable to a somewhat lower gross profit margin and
higher costs in the form of more marketing activities. IFRS 16 had
a positive impact on EBITDA of SEK 4.0 million.
CAPITAL TIED UP
Capital tied up in goods amounted to SEK 3,467.4 million and
increased by SEK 478.9 million compared with the previous year
(SEK 2,988.5 million). The increase is mainly related to new
product ranges, but also the build-up of inventories in North
America. The exchange rate change when translated to SEK
increased the value by SEK 47.4 million. The Group has a well-ba-
lanced stock and the level of service is good. Stock value is expected
to remain at a higher level also in the coming quarters due to
our expanded product range. Stock turnover is on a par with the
previous year and amounted to 1.0 (1.1) times.
Net sales for the first six months of the year increased by 12% to
SEK 1,576.9 (1,403.9) million. All regions had growth, but the
USA, Southern Europe and Other countries had somewhat higher
growth than the segment as a whole. It was mainly within the
promo sales channel that sales increased. EBITDA increased by
SEK 50.1 million and amounted to SEK 202.7 (152.6) million.
The improved result is related to the increased turnover, but the
segment also had higher costs. The higher costs were in the form
of more sales and marketing activities and higher costs for dist-
ribution units. The cost increase for the distribution units was
related to larger premises as well as other improvement measures
to increase the service level. IFRS 16 had a positive impact on
EBITDA of SEK 39.5 million.
SEK million
Raw materials
Work in progress
Goods in transit
Merchandise on stock
Total
SPORTS & LEISURE
Net sales for the period April-June increased by 17% to SEK 687.0
(585.1) million. Sales increased in both sales channels, but mainly
in retail. The segment experienced growth in all regions. EBITDA
increased by SEK 6.8 million and amounted to SEK 49.0 (42.2)
million. The improvement in earnings is related to IFRS 16, and
excluding the effects of the new standard, earnings decreased
slightly. The segment had higher costs for sales, marketing and
distribution units. IFRS 16 had a positive impact on EBITDA of
SEK 9.1 million.
30 Jun
2019
51.5
13.5
207.9
3 194.5
3 467.4
30 Jun
2018
38.1
16.1
154.4
2 779.9
2 988.5
Accumulated write-down of inventories amounted to SEK 125.4
(109.9) million and write-down related to merchandise on stock
amounted to 3.8 (3.8) %.
Accounts receivable amounted to SEK 1,092.2 (984.3) million,
where the increase is related to higher sales.
INVESTMENTS, FINANCING
AND LIQUIDITY
Net sales for the period January-June increased by 19% to SEK
1,329.8 (1,115.7) million. Sales increased in both sales channels,
where promo increased by 12% and retail by 22%. The segment
experienced growth in all regions. EBITDA increased by SEK 30.5
million and amounted to SEK 86.0 (55.5) million. The impro-
vement in earnings is related to higher sales and an improved
gross profit margin, but the segment also has higher costs for sales,
marketing and distribution units. IFRS 16 had a positive impact
on EBITDA of SEK 18.3 million.
Cash flow from operating activities for the quarter amounted to
SEK 9.0 (124.6) million. The Group's merchandise purchases
have been higher than last year and the lower cash flow is mainly
attributable to the timing of payments thereof. Cash flow from
investing activities amounted to SEK -35.6 (-41.6) million.
8