Rapala VMC issues negative profit warning but sees ‘pockets of growth’

Rapala VMC Corporation has issued a negative profit warning, telling investors that its operating profit will be ‘significantly’ below the previous year.

The Finnish giant says that the key drivers behind the decreased outlook include a short open water fishing season in 2022, marked by strong destocking at retail level with very low purchase levels.

It said that the weather was also ‘abnormal’ on all key continents, which caused further pressure on the season. Another major factor is the impact globally of the difficult macro-economic outlook with the impacts from low consumer spending when energy prices are rocketing and inflation is high.

In its statement to the Helsinki Stock Exchange yesterday, the group added: “Despite the difficult trading conditions in 2022, strategy execution is not slowing down. On the contrary, it is being accelerated in several areas. As an example, supply chain and operations management areas have been accelerated in light of the fast post-Covid market normalisation.

“In the important and growing rod and reel category, Okuma is off to a very strong start in Europe. The high brand awareness, wide product range and great value of Okuma is well suitable for current market conditions. It is also rewarding to see that we are currently benefiting from our strong position in the winter fishing category, which has resulted in a strong start to the season, confirming that there are pockets of growth, which the group will be utilising despite the difficult trading conditions.”