Successful strategy leads to improvement of the financial result
Fristads Kansas Group continues to improve its financial performance.
Revenue increased in 2019 by five per cent to SEK 4.5 billion (4.2) and net profit increased by 49 per cent to SEK 137 million (92).
The strategy of focusing on, and investing in, the Group’s strong brands and insourcing of logistics contributes to the positive development.
The divestment in early 2020 of the French brand Bragard, which develops workwear for the hotel and restaurant industry, makes Fristads Kansas Group’s business more streamlined.
During the spring of 2020, actions have been taken to handle the effects of the Covid-19 pandemic.
When summarising 2019, Fristads Kansas Group notes that many targeted and strategic investments have contributed to an improved financial result. The sale of Bragard has made the business more focused, and actions taken in the spring of 2020 provide the necessary stability as Covid-19 impacts the market.
Strategic investments in independent brands and in-house logistics deliver improved results
In 2019, net sales increased by five per cent, totalling SEK 4.5 billion (4.2). Profitability continued to improve and operating profit (EBIT) increased by ten per cent to SEK 240 million (218). The operating margin was 5.4 per cent (5.1). Profit after tax increased by 49 per cent to SEK 137 million (92).
The 2019 performance is a result of a focused and successful strategy. The 2018 decision to insource the warehouse and logistics operations was implemented in 2019. In September, the new distribution center in Viared, outside Borås, began operation. Fristads launched the world’s first environmentally declared clothing collection, Fristads Green, which during the year was awarded with the highly regarded Red Dot Award: Design Concept. Wenaas achieved an international breakthrough, signing a new framework agreement with a global actor in sea freight, among other things. To support its international strategy, Wenaas established new service points in Aberdeen, Rotterdam and Singapore during the year. Kansas was relaunched as an independent brand, introduced new collections, and ran a series of highly appreciated marketing campaigns. Leijona experienced strong growth with the launch of new collections for several large Finnish customers. Within the healthcare segment, Sverre W Monsen and Martinson launched new collections and secured new agreements in Norway, Sweden and Finland. Hejco continued to roll out the new framework agreement with most of the municipalities in Sweden. Clinic Dress recruited a new MD with experience from direct marketing and sales. Under his leadership, the investment in e-commerce solutions for customers within the healthcare sector in Germany and surrounding countries is thus strengthened, and the early results thereof can be seen. At the same time, the success continued for B&C in the promotional wear segment during 2019 on the back of new, highly appreciated collections. In early 2020, the launch of a completely new sweatshirt collection was very positively received by the market.
”We let our brands develop independently and on their own merits. During the year, many of them secured large new agreements and gained renewed trust from major customers. As a result, sales have developed positively. Investments in both product development as well as marketing are delivering results,” says Anders Davidsson, CEO of Fristads Kansas Group.
The divestment of Bragard streamlines the Group for the future
After the financial year ended, in January 2020, the French brand Bragard was sold to the American group Chef Works. The sale of Bragard, which develops and sells workwear for the hotel and restaurant sector, helps streamline the Fristads Kansas businesses. Following the divestment the Group has three clear focus areas: workwear for building, construction and industry, which in 2019 accounted for about 44 per cent of total revenue, workwear for the healthcare sector, which in 2019 accounted for about 19 per cent, and promotional wear for events and similar activities, which in 2019 accounted for about 30 per cent of total revenue. Bragard’s revenue made up seven per cent of the Group’s total 2019 revenue.
Actions taken to minimise the effects of Covid-19
Since the middle of March 2020, Fristads Kansas Group has worked hard to adapt its business operations to the new situation resulting from the Covid-19 pandemic. The impact it has on the Group’s brands vary depending on the industries they serve. In this context it is rewarding to see that the brands supplying workwear to the healthcare sector have been able to contribute positively in this difficult situation.
To be able to handle the challenges Covid-19 brings, the Group has launched several activities, in particular a cost-saving programme, including staff reduction in parts of the business, as well as adjustment of inventory. The effects of Covid-19 are being handled in a satisfactory way for all the brands within the Group.
”Many of us have worked hard during the past few months after Covid-19 reached Europe. Fristads Kansas Group has first and foremost focused on taking actions to secure our employees’ health and safety. After that, our focus has been on limiting the economic consequences and adapting our business to the current situation, as well as ensuring that we are prepared when activity returns to normal levels again. I want to take this opportunity to express my gratitude to all employees, who have been affected by, and contributed to, these actions,” says Anders Davidsson.
For additional information please contact Anders Davidsson on phone number +46 70 545 70 80.
Fristads Kansas Group is Europe’s largest professional wear group with many leading brands including Fristads, Wenaas, Kansas, Leijona, Clinic Dress, Sverre W Monsen, Martinson and Hejco, as well as B&C. The Group is active in the design, production and marketing of professional wear for a variety of end-use segments and has strong market positions, especially in Northern Europe. For more information, please visit www.fristadskansasgroup.com.
End of January 2020, Fristads Kansas Group sold Bragard to the American Group Chef Works.
• Successful turnaround of the Group with positive net income in 2016
• Re-introduction of Fristads as stand-alone workwear brand
Fristads Kansas, one of the largest workwear brands for construction and industry, reports a growth of 6 percent for the full year 2015. Operating profit (EBIT) amounted to 5.9 MEUR and Fristads Kansas maintained strong market positions in its home markets Sweden and Denmark, and grew in a number of other markets. At the same time, the Fristads Kansas Group, showed a strong positive trend.
During March 2016, Fristads Kansas Group sold Lafont to the French workwear and PPE group Cepovett.
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