Utenos Trikotazas : trikotažas Group‘s sales increased by 8 % to reach EUR 15,7 million in first half of 2019

Utenos Trikotazas
Interim information

Utenos trikotažas Group's sales increased by 8 % to reach EUR 15,7 million in first half of 2019

Utenos trikotažas textile group revenues from goods and services reached EUR 15,7 million in the first half of 2019 which was 8,0 per cent more than during the same period in 2018. Utenos trikotažas as a Company increased their sales by 5,8 % to reach EUR 13,8 million. Revenue from services for the production functional-technical garments manufacturing provided by Šatrija AB in first half increased by 26,4 per cent up to 1,9 million.

The demand for higher value-added products is growing

On-demand jersey garments sales accounted for EUR 12 million in the first half year which was 5,2 per cent higher than last year. Significant growth recorded in the main export region - German-speaking countries (DACH) with sales increasing by 22,1 per cent. Group exported EUR 12,5 million in total which made up 79,6 per cent of the total Group revenue.

'The main growth drivers remain acquisition of new customers and constant development of new technologies and products. The sales development in DACH region was especially successful where our higher value-added products are very much in demand by our existing and new customers. Scandinavia region somewhat declined in sales however it did not stop us from growing our total sales in the second quarter of 2019 by as much as 21.8%'- comments Algirdas Šabūnas, CEO of Utenos trikotazas.

For the first half of the year sales of own brands - UTENOS and ABOUT - accounted for EUR 1,9 million up 10,4 per cent from last year.

The cost of developing new customers and products affects profitability

In the first half of 2019 the Group suffered a loss before tax of EUR 22 thousand (last year recorded a profit of EUR 567 thousand).The group's EBITDA amounted to EUR 419 thousand, which is by 54,3 per cent less than last year. The Company accounted a loss before tax of EUR 64 thousand (in 2018 reached a profit of EUR 404 thousand), Company's first half EBITDA decreased by 66,4 per cent and stood at EUR 251 thousand.

'Profitability of the company in the first half of 2019 was negatively affected by extra costs associated with the development of new products and technologies. Nevertheless, we believe these costs will pay off soon as we see strong demand for such products and technologies. Another negative driver is significantly increased labor costs that were only partially offset by pricing. The remaining impact we expect to offset by increased sales of higher value-added products, production process digitization and process improvement projects that are currently running' - states Algirdas Šabūnas.

Utenos trikotažas is the largest and one of the most modern knitwear manufacturers in Central and Eastern Europe. The Utenos trikotažas group of companies, which also comprises Šatrija, Gotija and Mrija (Ukraine), is part of the SBA concern. The company Utenos trikotažas currently owns the Utenos and About retail brands. In 2017, Utenos trikotažas became the first Lithuanian company to join the Detox campaign of Greenpeace