Tiger of Sweden owner IC Group boosts earnings forecast
IC Group may have been under pressure in recent periods but at least it had some better news on Friday as the owner of the Tiger of Sweden and By Malene Birger brands revised its earnings guidance upwards.
The company said that “based on the preliminary figures for the financial year 2017/18, the group expects its earnings for the year under review to be realised at an EBIT margin of approximately 7%.” The most recent outlook had said “approximately 6%” and the original outlook communicated earlier had been even lower at “approximately 5%”.
So what's responsible for this good news? “This upward revision is primarily attributable to the lower-than-expected cost level in Tiger of Sweden as well as further cost savings in IC Group’s corporate functions during Q4 2017/18,” the company explained.
Unfortunately, “all other previously announced expectations for the financial year 2017/18 remain unchanged. The group still expects to realise a minor revenue reduction compared to the [previous] financial year,” it told us.
Back in May, the company had reported tough times in Q3, with it key brands finding sales growth elusive. Both Tiger of Sweden and By Malene Birger reported significant sales falls.
But while the cost savings news is encouraging, what's really needed is for sales growth to be kickstarted as companies cannot continually rely on cutting costs to boost their bottom line. However, we won't know until August 28 just how its brands performed in Q4 as that's when the company publishes its annual report.
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