STOCKHOLM (BRAIN) — Thule Group sales in the first quarter of this year dropped 4.9% as a result of the COVID-19 pandemic that either closed or limited retailers in Europe and North America.
Sales in the quarter that ended in March were SEK 1,744 million ($176 million), compared to SEK 1,834 million ($186 million) year-over-year. Adjusting for rate fluctuations, sales decreased 7.5%.
"In the first quarter 2020, the Thule Group, like most of the world, lived through two completely different phases," said Magnus Welander, CEO and president. "We started the year very strong with increased sales, improved profitability and a more efficient use of capital. When then massive lockdowns were implemented in our main markets in Europe and North America, as a consequence of the corona pandemic, we saw a significantly reduced demand and needed to act quickly in a completely new reality."
Part of that adjustment involved various short-term furloughs and other cost-reducing initiatives, Welander said.
Year-over-year, operating income was SEK 325 million ($33 million), also down 4.9%. Net income was SEK 241 million ($24 million), compared to SEK 253 million ($26 million). Earnings per share before dilution was SEK 2.33 ($0.24), down 5%.
In the Americas, sales were down 13%, with currency adjusted. Like in Europe, Welander said, North American sales "dropped significantly" in mid-March. The kids category grew the most during the quarter with Thule's new Spring city-stroller and Urban Glide 2 jogging stroller leading the way.
Welander said Thule has focused on the health and safety of its employees, implementing travel bands, remote work and developing hygiene and social distancing measures at all assembly plants and distribution centers.
"At the same time, we have acted to ensure that we can cost-efficiently run the business in a short-term situation of significantly decreased demand," he said. "... It is currently not possible to estimate how the effect will be in the short-term, and we are therefore implementing measures to meet a short-term challenging financial reality in 2020. ..."
Thule's corporate headquarters is in Stockholm. Its stock is traded on OTCMKTS under the THULE symbol. Thule stock quote at Marketwatch.com.
