Lafuma Group reported a net loss of 700,000 ($1.0 mm) for the half year ended March 31, down from net income of 1.6 million ($2.3 mm). Operating profits for the group, which includes the Lafuma, Millet, Le Chameau and Oxbow brands, plummeted 82.4% to 800,000 ($1.2 mm).
Lafuma said business slowed and profits fell in 3 of its 4 divisions as a slowing economy and a long winter stunted growth, with the noteworthy exception being Asia, where sales grew by 17%.
With the exception of outdoor lifestyle apparel maker Le Chameau, the rest of Lafuma's divisions reported declines in profitability over this first half of the financial year.
Oxbow investment costs increased to develop both its network of retail outlets, where it added eight stores in one year, and international business.
Millet will post profit improvements at the end of this fiscal year.
The company said it expects profits to increase by the end of September.
Lafuma also provided additional details on Eider, a winter/snowsports apparel company it is acquiring. Eider posted sales of 21.3 million ($29.2 mm) in 2007. LaFuma had no offering in that market. When the deal is closed, Lafuma will invest 1.5 million in the company and take on the debt held by mezzanine investor Paris-Orleans, the de facto shareholder of Eider.
Lafuma said the deal is in line with the strategy of its Mountain division which now includes two symbolic brands: Millet and Eider. Advantages drawn will enable the group to begin FY 2008/2009 under more favorable conditions: economically, through the support of a group that functions more effectively, and strategically, through a complete and complementary outdoor offer for both products and markets.
Turnover, or sales, for the first six months of fiscal 2008 rose 0.6% to 120.7 million ($177.8 mm). In April, the French company reported that sales at its Board Sports division, which includes Oxbow, rose 7.4%, while sales fell 0.7% at its Outdoor division, which includes Lafuma. Comparable sales declined 3.9% at its Mountain division, which includes Millet. Sales at the Country division, which includes Le Chameau, fell 4.5 percent and 2.1% on a comparable basis. At Millet, setbacks were mainly the result of delivery delays in April.