NWG Annual Report 2019 - EN NWG Annual Report 2019 - EN | Page 57

NWG // FINANCIAL INFORMATION
Fi
nc
na
ia l in forma
tio
n
Board of
Directors' report
The Board of Directors and CEO of New Wave Group AB (publ), 556350-0916,
based in Gothenburg, hereby submit the financial statements and consolidated finan-
cial statements for the financial year 1 January 2019 to 31 December 2019.
9%
Increase in
net sales
Corporate
12%
Increase in
net sales
Sports & Leisure
2%
Increase in
net sales
Gifts & Home
Furnishings
New Wave Group is a growth
company that creates, acquires and
develops brands.
Our brands are categorized
into three operating segments:
Corporate, Sports & Leisure and
Gifts & Home Furnishings.
The Group will achieve synergies
by coordinating the design,
purchasing, marketing, ware-
housing, and distribution of the
product range.
To ensure good allocation of risks,
the Group will offer its products
in the promo market and the retail
market.
New Wave Group’s competitiveness lies primarily in
its strong brands, considerable expertise, high level of
service, and a well-developed overall concept. Products
are primarily manufactured in Asia, and to a lesser
extent in Europe. Thanks to its relative size, New
Wave Group has good purchasing prices and efficient
logistics. The Group’s most well-known wholly-owned
brands include AHEAD, Auclair, Clique, Cottover,
Craft, Cutter & Buck, Grizzly, J. Harvest & Frost, James
Harvest Sportswear, Jobman, Kosta Boda, Orrefors,
PAX, Projob, Sagaform, Seger and Toppoint.
Summary of 2019
Net sales amounted to SEK 6,903.5 million, which
was an improvement of 10% (5% excluding currency
change) compared to the previous year. The Group has
seen growth during all quarters and has also increased
sales in all regions and in both sales channels.
Corporate increased their net sales by 9%. During
the year, the Group continued its efforts to improve
its service level and made further investments in new
distribution centers. This work includes larger ware-
houses as well as improvements in IT systems. In
addition, the segment has continued its efforts on the
sales side, such as an increase in the number sales staff
and a high level of marketing activities.
Sports & Leisure's investments in the Craft brand
and their teamwear collection have intensified in
2019. In addition to agreements with smaller clubs
and associations that form our base, Craft signed new
agreements with Hammarby Fotboll, Swedish National
Team in Handball and extended the agreement with the
Swedish Athletics Association. For the second year in a
row, the brand was named best supplier in the "Team
Sports" category by the German magazine SAZ sport.
Cutter & Buck is also developing well and has good
growth in Europe and Canada. The segment as a whole
increased its net sales by 12% compared to last year. In
addition to more marketing activities (mainly related to
teamwear), the segment expanded its warehouse space
and made improvements in IT systems.
Gifts & Home Furnishings increased its net sales
by 2%. However, the improvement in sales was not
sufficient to cover the higher cost structure established
in the segment. EBITDA became negative and measures
have been taken to improve earnings. In addition, a
business combination has been made. This is expected
to complement existing brands.
Both sales channels improved their net sales. Promo
increased by 9% and retail by 10%. The efforts made
in the form of expanded warehouses and improved IT
systems are related to both sales channels.
The Group's gross profit margin is at the same level
as last year and amounted to 46.4 (46.6)%.
The new accounting standard IFRS 16 has had a
positive impact of SEK 135.6 million on the Group's
external costs compared with the previous year.
Excluding IFRS 16, the Group increased its expenses
during the first half of the year, which was related to an
increase in marketing activities and new recruitments
within sales, warehousing and customer service.
ANNUAL REPORT // 057