Stockmann Group turns first profit in three years
Finnish department stores chain Stockmann Group reported a quarterly profit for the first time in three years as cost savings measures helped deliver healthy margins despite a sales decline.
The group, also owner of the Lindex and Seppälä brands, said operating profit for the third quarter improved for the sixth consecutive period to reach 2.9 million euros, compared with a loss of 10.6 million euros last year.
Stockman launched an efficiency programme in February 2015, which has set an annual cost savings target of 50 million euros.
Despite the turnaround efforts, revenue fell 9% to 288.9 million euros impacted by weak demand in Russia and low consumer confidence in Finland, the company’s largest market.
“The results are gradually starting to follow the right track. The group’s gross margin improved during the quarter, to 54.8 per cent, with improvements made in both Stockmann Retail and Lindex. Lindex continued its earnings growth, though the September sales were weak in the Swedish fashion market for retailers,” said CEO Lauri Veijalainen.
Stockmann expects revenue for 2016 to be down on 2015 due to the comprehensive reorganisation programme. Adjusted operating profits are expected to be slightly positive.
In addition to the financial results, the Finnish company announced the appointment of a new Chief Customer Officer. Anna Salmi joins the Management Team on October 28 2016, and will lead the group’s Marketing and Digitalisation department, which is responsible for customer relationships, marketing and digital service
Salmi has been with Stockmann since 2015, when she joined as Director of Digital Retail. Prior to this, she served as Commercial Director and Sales and Marketing Director at Aurinkomatkat - Suntours and as Director of Digital Marketing at Finnair.
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