CEO's review


CEO Lauri Veijalainen, Half year financial report 2018 (16.8.2018):

Our second quarter was a good quarter for the Group. The Group’s performance improved and the adjusted operating profit was up by nearly EUR 10 million. The gross margin continued to improve due to healthy inventory levels and reduced clearance sales.

Lindex showed solid sales growth thanks to strong, renewed spring and summer collections which led to increased sales in all markets and channels. The tough but needed cost savings are also starting to bear fruit. The gross margin improved and subsequently the adjusted operating result increased by EUR 8 million.

In Stockmann Retail, the Crazy Days campaign in April was a success, but sales were slower towards the end of the quarter. We aim to compensate the decline in revenue with an improved gross margin and cost savings throughout 2018, and thus to catch up with Retail’s performance improvement schedule targets. However, Stockmann Retail is not expected to reach a positive operating result for the full year. Digital projects aiming at increasing sales are also under way.

Real Estate’s performance continued as planned. Based on customer feedback, we introduced several new restaurants and cafés in our department stores during the quarter. The divestment of the Book House in Helsinki was completed. Investigations into the possible divestment of the Nevsky Centre in St Petersburg are being actively pursued.

In the autumn, we will continue to speed up our strategic projects, particularly digital acceleration, in order to reach the growth targets and improve our profitability. Due to seasonality, the most important months are ahead of us, in the second half of 2018.