Rapala VMC President and CEO Cyrille Viellard reported that the company he leads had positive start to 2026 with 13 percent sales growth at comparable exchange (ce) rates, supported by exciting new product introductions and efficient supply chain execution, enabled an encouraging performance despite continued global market uncertainty.

“Under our flagship Rapala brand, key new products—including CrushCity Mooch Minnow, Claptail, Harvest Shad and Snare—have been very well received by the market,” Viellard shared. “Our Sufix fishing lines division, a leader across braids, nylon monofilaments, and fluorocarbon lines, continued to deliver strong momentum, further supported by the launch of the Sufix Defcon fluorocarbon range. Growth in Rapala CrushCity soft baits continues to fuel demand for our innovative VMC jigs. The VMC Minnow Shaker, awarded “Best Terminal Tackle” at ICAST last year, has successfully translated into strong commercial performance.”

Overall, Viellard said all brands benefited from positive momentum across the company portfolio, underlining the strength of an innovation-driven strategy backed by a portfolio of trusted brands.

“In the Northern Hemisphere, where the majority of our sales are generated, Q1 is a critical period as retailers prepare for the open water season and replenish inventory,” he noted. “Careful planning and timely ordering resulted in early deliveries and high fill rates, while simultaneously reducing inventory levels.”

Viellard said the sales growth, combined with continued cost discipline, resulted in improved profitability in line with expectations as comparable operating profit increased by 39 percent year-over-year in the quarter.

The CEO wrapped up his investor letter with an outlook view, stating, “Looking ahead, we remain cautious given geopolitical volatility and inflationary pressures driven by rising oil prices, that is impacting raw materials such as plastics and could affect end consumer demand. Nevertheless, we remain confident in our resilience and our ability to further improve comparable operating profit in 2026.”

Market Environment
During the first quarter, the Helsinki, Finland-based company said operating environment reportedly improved although sales growth varied geographically.

The North American market reportedly remained strong, supported by resilient consumer demand. Despite continued geopolitical turbulence, consumer interest in fishing remained healthy, with North American consumers appearing relatively less impacted by international uncertainty in their purchasing behavior.

The European and Asian markets reportedly remain “subdued” due to continued trade tensions and high-intensity conflicts in Europe and the Middle East.

First Quarter Sales Summary
The Group’s net sales for the first quarter were up 6 percent against the year-ago Q1 period with reported currency translation exchange rates. With comparable-translation exchange (ce) rates, net sales were organically up by 13 percent year-over-year (y/y).

North America
Sales in North America increased 8 percent (+20 percent ce) y/y to €40.5 million in the first quarter. Sales in North America were said to be “exceptionally strong” during the quarter, partly explained by tariff-related price increases.

“A strong ice fishing season supported replenishment orders, and retailer interest ahead of the summer fishing season remained healthy with a solid order book and clean sales pipeline,” the company said in its Q1 earnings release report. New product introductions reportedly continued to drive sales, and growth was said to be broad-based across the main brands.

Europe
Sales in the European market increased by 4 percent y/y in both reported and comparable translation exchange rate terms to €22.7 million.

“Overall demand developed positively during the quarter, although with notable differences across countries,” Rapla noted. “First quarter pre-season deliveries for the summer fishing season topped last year’s level although the region continued to face soft market conditions and retailers focused on preserving cash. Continued focus on strategic brands and key customer relationships together with good delivery reliability supported sales development.”

Lower OEM hook sales slowed overall sales growth in the region, primarily due to softer customer demand.

Rest of the World (RoW)
Sales in the RoW region increased 3 percent (+7 percent ce) y/y to €6.3 million.

“Sales continued difficult and decreased in Asian markets due to global trade disputes weighing on consumer sentiment and discretionary spending,” the company said. “Growth in the region came solely from Latin American markets where growth was broad-based and further supported by the new Okuma distribution in Chile.”

Financial Results and Profitability
Comparable operating profit increased by €2.2 million from €5.6 million to €7.8 million.

Reported operating profit increased by €1.7 million from the comparison period and the items affecting comparability had a positive impact of €0.1 million (2025 Q1: negative €0.4) on reported operating profit.

Comparable operating profit margin was 11.2 percent (2025 Q1: 8.6 percent) of sales for the first quarter, a 260 basis-point improvement year-over-year. The improved profitability was said to be primarily driven by strong sales growth. Rapala said sales margin improved slightly during the period, while continued cost discipline kept operating expenses close to the prior year level.

Reported operating profit includes a -€0.1 million (2025 Q1: €0.5 million) mark-to-market valuation of operative currency derivatives. Other items affecting comparability, included in the reported operating profit were €0.0 million (2025 Q1: €0.1 million).

Financial Position
Cash flow from operations improved from the previous year and landed at -€3.8 million (2025 Q1: -€9.3 million).

Change in net working capital had a negative €12.7 million (2025 Q1: negative €15.5 million) impact on cash flow. Working capital was seasonally elevated during the first quarter, primarily driven by increased receivables associated with pre-season sales programs. Excluding working capital impact, cash flow from operations improved from the previous year and was €8.9 million (2025 Q1: €6.3 million). Strong focus on cash flow remains a key priority for the Group.

At the end of the period inventory was €82.5 million (2025 Q1: €84.9 million). Changes in translation exchange rates decreased inventory value by €2.2 million. Inventories increased due to U.S. tariffs, which were capitalized into inventory values. Excluding the tariff impact, inventories decreased and inventory turn improved from the prior-year quarter.

Net cash used in investing activities was -€0.9 million (2025 Q1: -€0.9 million). Capital expenditure was €0.9 million (2025 Q1: €1.0 million) and disposals €0.0 million (2025 Q1: €0.1 million). Expenditure consisted mainly of maintenance of manufacturing capacity and investments in new products.

Liquidity position of the Group was said to be “good.” Undrawn committed long-term credit facilities amounted to €19.6 million. Commercial papers sold under the commercial paper program amounted to €19.0 million (€29.0 million) at the end of the reporting period.

Gearing ratio increased and equity-to-assets ratio decreased from last year. On the Q1 2026 testing date, the financial leverage ratio landed at 3.59. The Group is currently compliant with all financial covenants and expects to comply with future bank requirements as well. The Group’s liquidity position remains good, and cash and cash equivalents amounted to €21.6 million at the end of the reporting period.

Short-term Outlook for 2026 (unchanged)
Rapala VMC Oyj expects 2026 full-year operating profit (excluding mark-to-market valuations of operative currency derivatives and other items affecting comparability) to increase from 2025.

Image, data and table courtesy Rapala VMC