Gross profit increased to SEK30.3 billion from SEK29.8 billion, but the gross margin was down to 52.7% from 54.8%.

Selling and administrative expenses increased by 3% to SEK25.5 billion (although in local currencies, these expenses fell by 2%). The company also said high raw materials and freight costs and a strong US dollar had a negative impact on the results compared with the previous year.

It all meant that net profit fell to SEK3.28 billion from SEK 3.68 billion.

For the first half as a whole, operating profit was SEK5.46 billion, down slightly from SEK5.44 billion. Sales increased by 9% to SEK112 .4 billion, but in local currencies net sales were up only 1%. 

Net profit fell to SEK3.82 billion from SEK3.89 billion. The company said the figures for the whole six months were hurt by those high raw materials and freight costs and a strong US dollar that affected Q2 specifically, but also by increased energy costs and the effects of winding down its operations in Russia.

CEO Helena Helmersson took an upbeat stance though. She said the group has been “taking important steps towards our goals. The summer collections have been well received and the third quarter has got off to a good start”.

She added that in Q2, the company “increased sales in many markets despite reduced purchasing power and unfavourable weather conditions compared with last year. The conditions for increased growth as well as profitability continue to develop in a favourable direction”.

These conditions include external factors that have affected its purchasing costs continuing to improve; work on the cost and efficiency programme “proceeding at full speed”; and “much of the work that we have done in recent years starting to bear fruit”. 

With business going in the right direction, next year’s operating margin is predicted to reach 10%.