Jan. 16 (Bloomberg) -- KappAhl AB, Sweden’s second-largest publicly traded clothing retailer, rose the most in fifteen months in Stockholm trading after it reported first-quarter earnings that beat analyst estimates.
KappAhl jumped as much as 21 percent to 5.30 kronor, the biggest intraday gain since Oct. 10, 2011. Shares traded 16 percent higher at 5.05 kronor as of 12:17 p.m. local time, with volume representing more than nine times the three-month daily average. The shares’ gain was the biggest among the 281 companies listed on the OMX Stockholm All Share Index.
KappAhl swung to a profit of 115 million kronor ($17.7 million) in the three months through November, from a net loss of 11 million kronor in the same period a year earlier, the Moelndal, Sweden-based company said in a statement today. Analysts had estimated profit of 70.4 million kronor, according to the average of five estimates compiled by Bloomberg. Sales rose 4.4 percent to 1.25 billion kronor in the quarter.
“We have kept down costs and we are improving our equity/assets ratio through selling real estate,” Chief Executive Officer Johan Aberg said. “It’s a little too early to say this is a new positive trend for the company but it’s quite clear there are strong signals indicating we are on the right path.”
KappAhl, which primarily targets clients who are mothers and are shopping also for their children and partners, said the gross margin for the quarter rose to 63.3 percent from 58.4 percent a year earlier. The company has previously postponed plans to expand in Europe as it focuses on profitability in existing markets, adding that expansion this year is seen at 13 new stores, lower than the annual target of 25.
To contact the reporter on this story: Toby Alder in Stockholm at firstname.lastname@example.org
To contact the editor responsible for this story: Kim McLaughlin at email@example.com