NWG Annual Report 2019 - EN NWG Annual Report 2019 - EN | Page 98

NWG // FINANCIAL INFORMATION //
THE GROUP
Other risks
Purchasing market
New Wave Group’s purchases are mainly made in
China, Bangladesh, India and Vietnam. Political
and socioeconomic changes could have an impact
on New Wave Group. By maintaining a high level of
preparedness and by making purchases in several
different countries in Europe as well as Asia, New
Wave Group limits the economic risk which would
arise if purchases were made from a single country.
Strong growth
The continued expansion planned by New Wave
Group will put strong pressure on management and
employees. Wrong recruitments, organizational
problems, the departure of key individuals etc. could
delay and affect the progress of the expansion. The
crucial factor determining the pace of expansion is
that results expand at the same pace. New Wave Group
is allocating resources to mentorship schemes and
annual meetings of management to guarantee strong
future leadership and spread New Wave Group’s
values.
Fashion trends – changes in
economic conditions
New Wave Group devotes significant resources to
ensure good design and quality. Still, due to the rapid
pace of change in the fashion industry, the Group
cannot exclude the possibility of temporary declines
in sales for certain collections. However, New Wave
Group has a limited risk, as the fashion content is low
in the Corporate operating segment and the promo
sales channel. The Sports & Leisure operating segment
also focuses on areas that are less sensitive to changes
in fashions, even if fashion trends have a somewhat
higher impact. New Wave Group’s goal is that the
promo sales channel shall account for 60–80 % of total
sales.
Foreign expansion
The Group intends to establish a presence in addi-
tional foreign countries only when previous foreign
operations are generating satisfactory profits. The
Board deems that this strategy represents a good
compromise between optimal growth and reduced
risk. New Wave Group believes it is very hard to
determine the exact timetables and budgets for new
foreign ventures, which could entail a risk of initial
losses. However, the Board deems that the company
is well equipped for the new ventures that are being
planned.
Environment
The Group’s operations may involve environmental
commitments, but the Board’s and the management’s
assessment is that these, to the extent that they may
have an impact on the Group’s financial position, have
been considered in the present financial statement.
Note 18 - Related parties
SEK million
Jobman Workwear GmbH
Dingle Industrilokaler AB
Kosta Köpmanshus AB
Vist Fastighets AB*
Total
The Group's
sales to
The Group's
purchases from
The Group's
receivables on
2019 2018 2019 2018 2019 2018 2019 4.5 0.0 0.0 0.0 6.4 2.4 0.0 0.0
0.2
3.7
0.0
8.4 0.1
2.7
0.1
2.9 4.3
21.2
0.0
25.5 3.5
18.4
1.3
23.2 23.5
1.9
0.0
31.8 23.5
0.5
0.0
26.5 0.4
0.9
0.0
1.3 0.4
2.2
0.0
2.6
* As from 1 December 2018, Vist Fastighets AB is a fully owned subsidiary to New Wave Group AB.
Associated companies are reported in note 13.
Information is also submitted in the presentation of
the Board and Management and in note 6. Reporting
of dividends from, and capital contributions to,
098 // ANNUAL REPORT
The Group's
liabilities to
associated companies is covered in note 13. All trans-
actions are carried out under market conditions.
2018