Fenix Outdoor Int’l AG Chairman Fenix Martin Nordin described the 2025 fiscal first quarter as another challenging period with “warm and volatile weather” in Europe, and a macroeconomic and political situation did not support this first quarter of 2025. Nordin’s comments came in a letter to investors accompanying the company’s first quarter financial report.

Nordin said January and February reportedly started okay, but the company saw a dip in the business in March. He said other businesses had also reported the trend.

The first quarter declined against last year’s Q1 period, with Fenix generating sales of €157.7 million in the first quarter, compared to €163.8 million in the 2024 Q1 period, a decrease of 3.7 percent year-over-year (y/y). He said the majority of the decline (€4.7 million) was related to the Frilufts business. The company’s other direct-to-consumer businesses were also said to be affected, primarily in March, as Frilufts was this year.

The operating profit fell to €5.2 million, or 3.3 percent of sales in the first quarter, compared to €12.8 million, or 7.8 percent of sales, in Q1 last year. The year-ago operating profit was €10.5 million, excluding capital gains made last year.

The company reported a decline in operating profit due to a lower gross profit of €4.9 million in the period.

“The costs are in control and were equal to last year, even though we will not see the full saving effects from our new logistic structure in Europe and new ERP system until fall 2025/early 2026,” Nordin explained.

Profit before tax amounted to €3.7 million in Q1, compared to €11.4 million in Q1 2024. The profit after tax of the Group was €94,000, compared to €6.9 million. Earnings per share amounted to €0.01 in Q1, compared to €0.51 in Q1 2024.

Brands and Global Sales
The company reported that Brands and Global external sales were relatively stable, in total, down 1.6 percent y/y. OPEX was reportedly on the same level as last year.

Brands
The company’s Brands segment showed external sales of €59.6 million in Q1, compared to €45.2 million in the year-ago quarter. The operating profit was reported at €14.1 million, compared to €12.9 million in Q1 2024.

“Most markets were stable in sales versus the same period last year,” Nordin noted. “The increase is coming from the transfer of Fjällräven wholesale operations in the USA and Canada from Global sales to Brands. The wholesale activities of Fjällräven and Hanwag in the German, Dutch and Swedish markets, and the direct-to-consumer Brand operations were already in Brands.”

Nordin said the company delivered preorders to plan, but the weather and political climate made the direct orders weaker than expected.

“We also suffered from low inventory, due to higher-than-expected demand for winter garments during January in the Nordic countries,” he explained. “The sell-through of our internal brands in Frilufts outperformed where Hanwag went against the stream with a double-digit sell-through increase.

Nordin also said Royal Robbins showed growth, whereas a better performing travel and warmer weather had a positive effect on sales. In terms of countries, he said they also saw comparatively better performance in Canada.

Global Sales
Global Sales reached external net sales of €34.7 million in Q1, compared to €47.6 million in the year-ago period. The operating profit for the quarter amounted to €5.8 million, compared to €7.8 million in Q1 last year.

“The JV in China outperformed almost every other market and had a very good quarter,” the chairman said. “The positive consolidated effect in operating profit (equity method), shown in results from associated companies, was limited by a weaker Chinese currency.”

Frilufts
The company reported that the first quarter was historically a very weak period for Frilufts, Nordin noted, but he also said several negative factors contributed to the lower sales and operating results in the period.

“A lack of winter weather in parts of Europe, calendar effects, lower overall demand, including cautious consumer spending and remaining overstock in the market, pushed out in sales campaigns by competitors,” he explained.

Sales were €66.4 million for the quarter, down 6.6 percent from €71.1 million in the year-ago quarter.

“One interesting fact was that brick and mortar only showed a small decline, whereas the major decline came from online sales, being very volatile,” Nordin said. He said the online business was very discount driven and discussions with other retailers confirms the same trend.

“We believe the markets still showed signs of over-inventory, and as we cleaned out a lot of the inventory last year, we saw a better gross margin on our sales in the online segment,” Nordin noted.

Direct-to-Consumer (DTC)
Total DTC sales were €87.6 million in the quarter, compared to €94.0 million in Q1 last year. The decrease in sales was said to be larger for online sales, which was reportedly down 8.6 percent y/y. Brick & Mortar sales declined 5.9, but was “not that bad” in all markets on a like-for-like basis, or comp store sales basis.

Nordin said the company’s owned retail stores in the U.S. still show a slight increase on a comp basis.

Devold
On March 4, 2025, Fenix Outdoor acquired 65 percent of Devold Norway AS. The consideration was in NOK, and recalculated it amounted to €35 million. The payment was in a combination of 112,898 Fenix Outdoor treasury shares valued at 5.5 million and cash. The net cash acquired to million 2.0 resulted in a cash outflow, or €32.6 million. The provisional acquisition analysis resulted in a preliminary goodwill position of €24.2 million and is not expected to be tax deductible.

Devold reportedly had a limited effect on the sales and operating profit for the first quarter.

Outlook
Nordin said he normally has a view of what is going to happen, but must now refrain from it as the current situation is extremely unpredictable.

“As it looks, we do currently not foresee any major direct effects from the potential higher tariffs (to USA) in 2025,” Nordin continued. “The potential indirect effects regarding lower consumer confidence and 2026 tariff effects are still difficult to judge.”

Nordin reiterated his statement from the 2024 Q4 report when he said, “In terms of orderbooks for 2025, we do see an improvement for both fall and winter.”

Nordin said he also feels a positive momentum just [after] leaving the spring/summer 26 kick off, showing a broader and very strong assortment from all the company’s brands.

“This kick-off was also the first one where our new brand, Devold, joined. A premium wool brand complementing our portfolio very well,” he noted.

“I am, however, convinced that we are well equipped for the future given the strength of our brands as well as the strength of our general organization and structure,” he shared. “All this makes us well equipped to capitalize when the market turns less nervous again.

“On the positive side, I must also mention our European production facilities,” he continued. “The production of Hanwag shoes in Europe, the Devold factory in Lithuania and the Maloja production partnership in Bulgaria will make us slightly more flexible for different tariffs and logistic challenges coming up.”

Image courtesy Royal Robbins/Fenix Outdoor Int’l AG