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Mavic hits profitability target

Published August 2, 2012

HELSINKI, Finland (BRAIN) Thursday August 2 2012 2:17 PM MT—Mavic sales inched up 2 percent in the second quarter of the year according to an earnings report released Thursday by its parent company, Amer Sports.

Amer Sports reported revenue of 29.6 million euros ($37.5 million) in its cycling division for the months of April, May and June, up from 27.9 million euros ($40.4 million) for the same period last year. Sales in the segment also increased 4 percent in local currencies for the first half of the year with revenue of 76.6 million euros ($97 million), compared with 56.3 million euros ($81.6 million) reported during the first six months of 2011.

The slight growth mainly stemmed from sales of rider equipment, the company said.

Heikki Takala, president of Amer Sports, said Mavic is meeting its long-term objectives of expanding its wheel and tire systems and softgoods lines, returning to target profitability and accelerating profitable growth.

“It’s there, it’s profitable. It is growing especially in the right segments mostly footwear, apparel and accessories and we are pleased with the progress there,” Takala said.

Overall, Amer, which also owns Salomon, Wilson, Suunto, Atomic, Precor and Arc’teryx, was up 5 percent in the second quarter, and 6 percent for the half-year, despite major retailers in Western Europe slimming down inventories and pre-orders due to the difficult economic situation there. Amer has seen strong double-digit sales growth in emerging markets in China, Russia and Latin America, but those high growth rates haven’t compensated fully for soft sales in Europe, Takala said.

Amer has also seen positive movement with its own brick and mortar retail stores and e-commerce stores, which now make up 3.5 to 4 percent of all sales. The company milestone is for business-to-consumer transactions to eventually account for 10 percent of sales. So far, it has opened 17 stores and 22 e-commerce stores with concept stores for Wilson, Suunto, Arc’teryx and Salomon in Europe, Asia and Mexico. Amer hasn’t indicated whether it will include Mavic in that concept store model in the future.

Nicole Formosa

Topics associated with this article: Earnings/Financial Reports

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