hummel will come out of 2022 with a record turnover of 2.218 billion DKK, while an investment in a new distribution center and major one-time costs result in a deficit of 89.5M DKK. The sports brand is now aiming for a turnover of 4 billion DKK and an operating profit of 300M DKK by the end of 2028.
HUMMEL DELIVERS NEW TURNOVER RECORD: GROWTH INVESTMENT AND ONE-TIME COSTS RESULT IN DEFICIT
hummel’s products are currently in high demand, which is evident in the recently published 2022 accounts, where the sports brand achieved its biggest turnover in 100 years. The revenue increased by 20 percent from 1.858 billion DKK in 2021 to 2.218 billion DKK in 2022.
To continue their growth journey from the past four years with a doubling of the turnover, hummel has invested significantly in a new distribution center in 2022. As a result, the record profit of 115M DKK from 2021 will transform into a deficit of 89.5M DKK in 2022.
“We take great pride in setting a new topline record for the second year in a row and reach our milestone of 2 billion DKK. This proves that the underlying business is really healthy. However, the investment in a new distribution center and the significant one-time costs associated with the relocation of our warehouse have impacted the bottom line,” says hummel CEO, Allan Vad Nielsen, and elaborates:
“As we reflect on our progress over the last four years, we are proud to have doubled our turnover and maximized the potential of our previous setup. In order to continue our growth, it has been necessary for us to invest in a new distribution center. We have planned and worked on this for several years, and despite the impact on our 2022 results, we believe it will yield significant long-term benefits for our brand.”
A NEW MILESTONE FOR 2028
Having achieved a consecutive topline record, hummel now sets its sights on reaching a turnover of 4 billion DKK by the end of 2028, along with a minimum operating profit target of 300M DKK. To achieve this growth, the sportswear brand plans to prioritize team sports, online sales, and the German market.
“We have an ambition to become Europe’s leading team sport brand, which is why we have invested heavily in an upgraded product portfolio, new sponsorships and an improved delivery profile. Several of the big players are currently leaving a gap in the market within both amateur and professional sports, and we see great opportunities to capture market shares in the area in the coming years,” says Allan Vad Nielsen and elaborates:
“This applies very much in Germany, where we continue to have momentum and experience great growth. Over the past three years, our business in Germany has tripled, and we believe this trend will continue in the future. As such, Germany will be a vital focus market for us as we work to achieve our ambitious growth targets by 2028. So do our online sales, which continues to soar, with annual growth rates of 50 percent.”
Aside from Germany, hummel also holds high expectations for the Spanish and French markets, where both have achieved impressive triple-digit million figures and are currently witnessing significant growth in digital platforms and the team sports category.
BACK IN BLACK IN 2023
Despite the current uncertainties in the market, hummel expects to continue the positive growth in 2023. The director of hummel forecasts a new top-line record, while acknowledging that earnings may experience a transitional year – yet still profitable.
“Our dedicated employees make a huge effort every single day to take hummel to new heights, and we are all driven by an ambition to challenge the big players in the market. Therefore, we remain committed to invest in diverse operational projects that will impact our financial results this year. Nonetheless, these endeavors will empower us to stand stronger than ever before when we go into 2024,” Allan Vad Nielsen concludes.
The company’s overall accounts include not only hummel but also three other brands: Newline for running clothing, Halo for fashion clothing, and Sometime Soon for children’s clothing.